EXHIBIT (iii)-(10)(h)

PITNEY BOWES INC.
DEFERRED INCENTIVE SAVINGS PLAN

AS AMENDED AND RESTATED
EFFECTIVE JANUARY 1, 2009

This document constitute part of a prospectus covering securities
that have been registered under the Securities Act of 1933.

ADOPTED BY EMPLOYEE BENEFITS COMMITTEE DECEMBER 23, 2008

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ARTICLE I

 

 

Establishment and Purpose

110

 

 

 

ARTICLE II

 

 

Definitions

110

 

 

 

ARTICLE III

 

 

Eligibility and Participation

114

 

 

 

ARTICLE IV

 

 

Deferrals

115

 

 

 

ARTICLE V

 

 

Company Contributions

117

 

 

 

ARTICLE VI

 

 

Benefits

117

 

 

 

ARTICLE VII

 

 

Modifications to Payment Schedules

119

 

 

 

ARTICLE VIII

 

 

Valuation of Account Balances; Investments

119

 

 

 

ARTICLE IX

 

 

Administration

120

 

 

 

ARTICLE X

 

 

Amendment and Termination

122

 

 

 

ARTICLE XI

 

 

Informal Funding

122

 

 

 

ARTICLE XII

 

 

General Provisions

122

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ARTICLE I
Establishment and Purpose

Pitney Bowes Inc. (the “Company”) hereby amends and restates the Pitney Bowes
Inc. Deferred Incentive Savings Plan (the “Plan”), effective January 1, 2009.
This amendment and restatement applies only to amounts deferred under the Plan
on or after January 1, 2005, and to amounts deferred prior to January 1, 2005
that were not vested as of December 31, 2004. From January 1, 2005 through
December 31, 2008 the Plan was administered in good faith compliance with the
requirements of Code Section 409A, the Treasury Regulations and official notices
and pronouncements thereunder. Amounts deferred under the Plan prior to January
1, 2005 that were vested as of December 31, 2004 (the “Grandfathered Accounts”)
shall be subject to the provisions of the Plan as in effect on October 3, 2004,
as the same may be amended from time to time by the Company without material
modification, it being expressly intended that such Grandfathered Accounts are
to remain exempt from the requirements of Code Section 409A. The plan governing
pre-2005 deferrals in the Grandfathered Account shall be renamed the Pitney
Bowes Inc. Deferred Incentive Savings Plan for Pre-2005 Deferrals
(“Grandfathered Plan”) and is attached for reference purposes as Appendix A.
However, Articles III (Administration), IX (Beneficiary Designation), X
(Amendment and Termination), and XI (Miscellaneous) of the Grandfathered Plan
shall be superceded and supplanted by the corresponding provisions in this Plan.

The purpose of the Plan is to attract and retain key employees by providing them
with an opportunity to defer receipt of a portion of their salary, bonus, and
other specified compensation. The Plan is not intended to meet the qualification
requirements of Code Section 401(a), but is intended to meet the requirements of
Code Section 409A, and shall be operated and interpreted consistent with that
intent.

The Plan constitutes an unsecured promise by a Participating Employer to pay
benefits in the future. Participants in the Plan shall have the status of
general unsecured creditors of the Company or the Adopting Employer, as
applicable. Each Participating Employer shall be solely responsible for payment
of the benefits of its employees and their beneficiaries. The Plan is unfunded
for Federal tax purposes and is intended to be an unfunded arrangement for
eligible employees who are part of a select group of management or highly
compensated employees of the Employer within the meaning of Sections 201(2),
301(a)(3) and 401(a)(1) of ERISA. Any amounts set aside to defray the
liabilities assumed by the Company or an Adopting Employer shall remain the
general assets of the Company or the Adopting Employer and shall remain subject
to the claims of the Company’s or the Adopting Employer’s creditors until such
amounts are distributed to the Participants.

ARTICLE II
Definitions

 

 

2.1

Account. Account means a bookkeeping account maintained by the Committee to
record the payment obligation of a Participating Employer to a Participant as
determined under the terms of the Plan. The Committee may maintain an Account to
record the total obligation to a Participant and component Accounts to reflect
amounts payable at different times and in different forms. Reference to an
Account means any such Account established by the Committee, as the context
requires. Accounts are intended to constitute unfunded obligations within the
meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA.

 

 

2.2

Account Balance. Account Balance means, with respect to any Account, the total
payment obligation owed to a Participant from such Account as of the most recent
Valuation Date.

 

 

2.3

Adopting Employer. Adopting Employer means an Affiliate who, with the consent of
the Company, has adopted the Plan for the benefit of its eligible employees.

 

 

2.4

Affiliate. Affiliate means a corporation, trade or business that, together with
the Company, is treated as a single employer under Code Section 414(b) or (c).

 

 

2.5

Beneficiary. Beneficiary means a natural person, estate, or trust designated by
a Participant to receive payments to which a Beneficiary is entitled in
accordance with provisions of the Plan. The Participant’s spouse, if living,
otherwise the Participant’s estate, shall be the Beneficiary if: (i) the
Participant has failed to properly designate a Beneficiary, or (ii) all
designated Beneficiaries have predeceased the Participant.

 

 

 

A former spouse shall have no interest under the Plan, as Beneficiary or
otherwise, unless the Participant designates such person as a Beneficiary after
dissolution of the marriage, except to the extent provided under the terms of a
domestic relations order as described in Code Section 414(p)(1)(B).

 

 

2.6

Business Day. A Business Day is each day on which the New York Stock Exchange is
open for business.

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2.7

Change of Control. Change of Control shall be deemed to have occurred if the
definition for Change of Control under the Pitney Bowes Senior Executive
Severance Policy has been met, as that definition is amended from time to time.

 

 

 

At the time of the Plan Restatement, the definition of Change of Control under
the Senior Executive Severance Policy is as follows:

 

 

 

“Change of Control” shall be deemed to have occurred if:

 

 

 

(i) there is an acquisition, in any one transaction or a series of transactions,
other than from Pitney Bowes Inc., by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”)), of beneficial ownership (within the
meaning of Rule 13(d)(3) promulgated under the Exchange Act) of 20% or more of
either the then outstanding shares of common stock or the combined voting power
of the then outstanding voting securities of Pitney Bowes Inc. entitled to vote
generally in the election of directors, but excluding, for this purpose, any
such acquisition by Pitney Bowes Inc. or any of its subsidiaries, or any
employee benefit plan (or related trust) of Pitney Bowes Inc. or its
subsidiaries, or any corporation with respect to which, following such
acquisition, more than 50% of the then outstanding shares of common stock of
such corporation and the combined voting power of the then outstanding voting
securities of such corporation entitled to vote generally in the election of
directors is then beneficially owned, directly or indirectly, by the individuals
and entities who were the beneficial owners, respectively, of the common stock
and voting securities of Pitney Bowes Inc. immediately prior to such acquisition
in substantially the same proportion as their ownership, im­mediately prior to
such acquisition, of the then outstand­ing shares of common stock or the
combined voting power of the then outstanding voting securities of Pitney Bowes
Inc. entitled to vote generally in the election of directors, as the case may
be; or

 

 

 

(ii) individuals who, as of the Restatement Effective Date, constitute the Board
(as of such date, the “Incumbent Board”) cease for any reason to constitute at
least a majority of the Board, provided that any individual becoming a director
subsequent to the Restatement Effective Date, whose election, or nomination for
election by Pitney Bowes’ shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office is in connection with an actual or threatened election contest relating
to the election of the directors of Pitney Bowes Inc. (as such terms are used in
Rule 14(a)(11) or Regulation 14A promulgated under the Exchange Act); or

 

 

 

(iii) there occurs either (A) the consummation of a reorganization, merger,
consolidation, or sale or other disposition of all or substantially all of the
assets of the Company, in each case, with respect to which the individuals and
entities who were the respective beneficial owners of the common stock and
voting securities of Pitney Bowes Inc. immediately prior to such reorganization,
merger, consolidation or sale or other disposition do not, following such
reorganization, merger, consolidation, or sale or other disposition beneficially
own, directly or indirectly, more than 50% of, respectively, the then
outstanding shares of common stock and the combined voting power of the then
outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting from such
reorganization, merger, consolidation, or sale or other disposition or (B) an
approval by the shareholders of Pitney Bowes Inc. of a complete liquidation or
dissolution of Pitney Bowes Inc. or of the sale or other disposition of all or
substantially all of the assets of Pitney Bowes Inc.

 

 

 

The determination as to the occurrence of a Change of Control shall be based on
objective facts and in accordance with the requirements of Code Section 409A.

 

 

2.8

Claimant. Claimant means a Participant or Beneficiary filing a claim under
Article XII of this Plan.

 

 

2.9

Code. Code means the Internal Revenue Code of 1986, as amended from time to
time.

 

 

2.10

Code Section 409A. Code Section 409A means section 409A of the Code, and
regulations and other guidance issued by the Treasury Department and Internal
Revenue Service thereunder.

 

 

2.11

Committee. Committee means the Executive Committee and the other committees to
which it has delegated authority. The Executive Committee has delegated to the
Employee Benefits Committee and the Trust Investment Committee certain authority
over the Company’s benefit plans, including this Plan, as described and
enumerated in the respective charters of the Employee Benefits Committee and the
Trust Investment Committee. The Employee Benefits Committee under its charter

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may further delegate its authority to administer and review claims made under
the Company’s benefit plans, including this Plan, to an Appeals Committee (see
Article XII) as it deems prudent and reasonable. The Executive Committee
reserves the right under this Plan to review all claims and appeals made by
executives in compensation Bands H and above.

 

 

2.12

Company. Company means Pitney Bowes, Inc, and its Affiliates.

 

 

2.13

Company Contribution. Company Contribution means a credit by a Participating
Employer to a Participant’s Account(s) in accordance with the provisions of
Article V of the Plan. Company Contributions are credited at the sole discretion
of the Participating Employer and the fact that a Company Contribution is
credited in one year shall not obligate the Participating Employer to continue
to make such Company Contribution in subsequent years. Unless the context
clearly indicates otherwise, a reference to Company Contribution shall include
Earnings attributable to such contribution.

 

 

2.14

Company Stock. Company Stock means phantom shares of common stock issued by
Pitney Bowes Inc.

 

 

2.15

Compensation. Compensation means a Participant’s base salary, bonus, cash
incentive unit payment, sign-on bonus, retention pay, commission and such other
cash or equity-based compensation (if any) approved by the Committee as
Compensation that may be deferred under this Plan. Compensation shall not
include any compensation that has been previously deferred under this Plan or
any other arrangement subject to Code Section 409A. The Committee, from time to
time, may determine which compensation awards are eligible for deferral.

 

 

2.16

Compensation Deferral Agreement. Compensation Deferral Agreement means an
agreement between a Participant and a Participating Employer that specifies (i)
the amount of each component of Compensation that the Participant has elected to
defer to the Plan in accordance with the provisions of Article IV, and (ii) the
Payment Schedule applicable to one or more Accounts. In its sole discretion, the
Committee may establish administrative rules from time to time regarding
different deferral amounts for each component of Compensation, a minimum or
maximum deferral amount for each such component or other rules deemed by the
Committee to be necessary for the orderly and efficient administration of this
Plan. A Compensation Deferral Agreement may also specify the investment
allocation described in Section 8.4.

 

 

2.17

Death Benefit. Death Benefit means the benefit payable under the Plan to a
Participant’s Beneficiary(ies) upon the Participant’s death as provided in
Section 6.1 of the Plan.

 

 

2.18

Deferral. Deferral means a credit to a Participant’s Account(s) that records
that portion of the Participant’s Compensation that the Participant has elected
to defer to the Plan in accordance with the provisions of Article IV. Unless the
context of the Plan clearly indicates otherwise, a reference to Deferrals
includes Earnings attributable to such Deferrals.

 

 

 

Deferrals shall be calculated with respect to the gross cash Compensation
payable to the Participant prior to any deductions or withholdings, but may be
reduced by rules established by the Committee as necessary so that it does not
exceed 100% of the cash Compensation of the Participant remaining after
deduction of all required income and employment taxes, 401(k) and other employee
benefit deductions, and other deductions required by law. Changes to payroll
withholdings that affect the amount of Compensation being deferred to the Plan
shall be allowed only to the extent permissible under Code Section 409A.

 

 

2.19

Earnings. Earnings means an adjustment to the value of an Account in accordance
with Article VIII.

 

 

2.20

Effective Date. Effective Date means January 1, 2009.

 

 

2.21

Eligible Employee. Eligible Employee means: (i) a member of a “select group of
management or highly compensated employees” of a Participating Employer within
the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA, as determined
by the Committee from time to time in its sole discretion.

 

 

2.22

Employee. Employee means a common-law employee of an Employer.

 

 

2.23

Employer. Employer means, with respect to Employees it employs, the Company and
each Affiliate.

 

 

2.24

ERISA. ERISA means the Employee Retirement Income Security Act of 1974, as
amended from time to time.

 

 

2.25

Executive Committee. Executive Committee means the Executive Compensation
Committee of the Board of Directors of Pitney Bowes Inc.

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2.26

Fiscal Year Compensation. Fiscal Year Compensation means Compensation earned
during one or more consecutive fiscal years of a Participating Employer, all of
which is paid after the last day of such fiscal year or years.

 

 

2.27

Grandfathered Account. Grandfathered Account means amounts deferred under the
Grandfathered Plan prior to January 1, 2005 that were vested as of December 31,
2004.

 

 

2.28

Participant. Participant means an Eligible Employee who has received
notification of his or her eligibility to defer Compensation under the Plan
under Section 3.1 and any other person with an Account Balance greater than
zero, regardless of whether such individual continues to be an Eligible
Employee. A Participant’s continued participation in the Plan shall be governed
by Section 3.2 of the Plan.

 

 

2.29

Participating Employer. Participating Employer means the Company and each
Adopting Employer.

 

 

2.30

Payment Schedule. Payment Schedule means the date as of which payment of an
Account under the Plan will commence and the form in which payment of such
Account will be made.

 

 

2.31

Performance-Based Compensation. Performance-Based Compensation means
Compensation where the amount of, or entitlement to, the Compensation is
contingent on the satisfaction of pre-established organizational or individual
performance criteria relating to a performance period of at least twelve
consecutive months. Organizational or individual performance criteria are
considered pre-established if established in writing by not later than ninety
(90) days after the commencement of the period of service to which the criteria
relate, provided that the outcome is substantially uncertain at the time the
criteria are established. The determination of whether Compensation qualifies as
“Performance-Based Compensation” will be made in accordance with Treas. Reg.
Section 1.409A-1(e) and subsequent guidance and as determined by the Committee
from time to time.

 

 

2.32

Plan. Generally, the term Plan means the “Pitney Bowes Inc. Deferred Incentive
Savings Plan” (sometimes referred to the DISP) as documented herein and as may
be amended from time to time hereafter. However, to the extent permitted or
required under Code Section 409A, the term Plan may in the appropriate context
also mean a portion of the Plan that is treated as a single plan under Treas.
Reg. Section 1.409A-1(c), or the Plan or portion of the Plan and any other
nonqualified deferred compensation plan or portion thereof that is treated as a
single plan under such section.

 

 

2.33

Plan Year. Plan Year means January 1 through December 31.

 

 

2.34

Retirement. Retirement means a Participant’s Separation from Service after
attainment of age 55.

 

 

2.35

Retirement Benefit. Retirement Benefit means the benefit payable to a
Participant under the Plan following the Retirement of the Participant.

 

 

2.36

Retirement/Termination Account. Retirement/Termination Account means an Account
established by the Committee to record the amounts payable to a Participant that
have not been allocated to a Specified Date Account. Unless the Participant has
established a Specified Date Account, all Deferrals and Company Contributions
shall be allocated to a Retirement/Termination Account on behalf of the
Participant.

 

 

2.37

Separation Benefit. Termination Benefit means the benefit payable to a
Participant under the Plan following the Participant’s Separation from Service
prior to Retirement.

 

 

2.38

Separation from Service. An Employee incurs a Separation from Service upon
termination of employment with the Employer. Whether a Separation from Service
has occurred shall be determined by the Committee in accordance with Code
Section 409A.

 

 

 

Except in the case of an Employee on a bona fide leave of absence as provided
below, an Employee is deemed to have incurred a Separation from Service if the
Employer and the Employee reasonably anticipated that the level of services to
be performed by the Employee after a date certain would be reduced to below 50%
of the average services rendered by the Employee during the immediately
preceding 36-month period (or the total period of employment, if less than 36
months) disregarding periods during which the Employee was on a bona fide leave
of absence.

 

 

 

An Employee who is absent from work due to military leave, sick leave, or other
bona fide leave of absence shall incur a Separation from Service on the first
date immediately following the later of (i) the six-month anniversary of the
commencement of the leave or (ii) the expiration of the Employee’s right, if
any, to reemployment under statute or contract.

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For purposes of determining whether a Separation from Service has occurred, the
Employer means the Employer as defined in Section 2.23 of the Plan, except that
for purposes of determining whether another organization is an Affiliate of the
Company, common ownership of at least 50% shall be determinative.

 

 

 

The Committee specifically reserves the right to determine whether a sale or
other disposition of substantial assets to an unrelated party constitutes a
Separation from Service with respect to a Participant providing services to the
seller immediately prior to the transaction and providing services to the buyer
after the transaction. Such determination shall be made in accordance with the
requirements of Code Section 409A.

 

 

2.39

Specified Date Account. A Specified Date Account means an Account established
pursuant to Section 4.3 that will be paid (or that will commence to be paid) at
a future date as specified in the Participant’s Compensation Deferral Agreement.
The Committee may limit the number of Specified Date Accounts. A Specified Date
Account may be identified also as an “In-Service Account”.

 

 

2.40

Specified Date Benefit. Specified Date Benefit means the benefit payable to a
Participant under the Plan in accordance with Section 6.1(c).

 

 

2.41

Specified Employee. Specified Employee means an Employee who is a “Key Employee”
under section 409A of the Code as determined by the Committee in accordance with
its procedures developed pursuant to section 409A of the Code and regulations
promulgated thereunder.

 

 

2.42

Specified Employee Identification Date. Specified Employee Identification Date
means December 31, unless the Employer has elected a different date through
action that is legally binding with respect to all nonqualified deferred
compensation plans maintained by the Employer.

 

 

2.43

Specified Employee Effective Date. Specified Employee Effective Date means the
first day of the fourth month following the Specified Employee Identification
Date, or such earlier date as is selected by the Committee.

 

 

2.44

Substantial Risk of Forfeiture. Substantial Risk of Forfeiture shall have the
meaning specified in Treas. Reg. Section 1.409A-1(d).

 

 

2.45

Unforeseeable Emergency. An Unforeseeable Emergency means a severe financial
hardship to the Participant resulting from an illness or accident of the
Participant, the Participant’s spouse, the Participant’s dependent (as defined
in Code section 152(a)), or a Beneficiary; loss of the Participant’s property
due to casualty (including the need to rebuild a home following damage to a home
not otherwise covered by insurance, for example, as a result of a natural
disaster); or other similar extraordinary and unforeseeable circumstances
arising as a result of events beyond the control of the Participant. The types
of events which may qualify as an Unforeseeable Emergency may be limited by the
Committee. Determination of an Unforeseeable Emergency under these rules shall
be made in the sole discretion of the Committee in accordance with the rules
under section 409A of the Code.

 

 

2.46

Valuation Date. Valuation Date shall mean each Business Day.

 

 

2.47

Year of Service. A Year of Service shall mean each 12-month period of continuous
service with the Employer.

 

 

ARTICLE III

Eligibility and Participation

 

 

3.1

Eligibility and Participation. An Eligible Employee becomes eligible to
participate in the Plan upon receipt of a specific written notification of
eligibility to participate from the Company. An Eligible Employee is eligible to
defer Compensation if the Eligible Employee submits a timely Compensation
Deferral Agreement and if the Eligible Employee is an Employee on the date the
Compensation would otherwise have been paid but for the deferral election. An
Eligible Employee becomes a Participant upon the earlier to occur of (i) a
credit of Company Contributions under Article V or (ii) a Compensation Deferral
by the Employee.

 

 

3.2

Duration. A Participant shall be eligible to defer Compensation and receive
allocations of Company Contributions, subject to the terms of the Plan, for as
long as such Participant remains an Eligible Employee. A Participant who is no
longer an Eligible Employee but has not Separated from Service may not defer
Compensation under the Plan but may otherwise exercise all of the rights of a
Participant under the Plan with respect to his or her Account(s). On and after a
Separation from

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Service, a Participant shall remain a Participant as long as his or her Account
Balance is greater than zero and during such time may continue to make
allocation elections as provided in Section 8.4. An individual shall cease being
a Participant in the Plan when all benefits under the Plan to which he or she is
entitled have been paid.

 

 

 

 

ARTICLE IV

 

Deferrals

 

 

 

 

4.1

Deferral Elections, Generally.

 

 

 

 

 

(a)

A Participant shall submit a Compensation Deferral Agreement during the
enrollment periods established by the Committee and in the manner specified by
the Committee, but in any event, in accordance with Section 4.2. A Compensation
Deferral Agreement that is not timely filed with respect to a service period or
component of Compensation shall be considered void and shall have no effect with
respect to such service period or Compensation. The Committee may modify any
Compensation Deferral Agreement prior to the date the election becomes
irrevocable under the rules of Section 4.2.

 

 

 

 

 

(b)

Subject to rules established by the Committee during the applicable enrollment
period, the Participant shall specify on his or her Compensation Deferral
Agreement whether to allocate Deferrals to a Retirement/Termination Account or
to a Specified Date Account. If no designation is made, all Deferrals shall be
allocated to the Retirement/Termination Account. A Participant may also specify
in his or her Compensation Deferral Agreement the Payment Schedule applicable to
his or her Plan Accounts. If the Payment Schedule is not specified in a
Compensation Deferral Agreement, the Participant’s Accounts shall be paid in a
lump sum upon either the Participant’s Retirement/Termination or on the
Specified Date as the case may be.

 

 

 

 

4.2

Timing Requirements for Compensation Deferral Agreements.

 

 

 

 

 

(a)

First Year of Eligibility. In the case of the first year in which an Eligible
Employee becomes eligible to participate in the Plan, he or she has up to 30
days following his initial eligibility to submit a Compensation Deferral
Agreement with respect to Compensation to be earned during such year. The
Compensation Deferral Agreement described in this paragraph becomes irrevocable
upon the end of such 30-day period. The determination of whether an Eligible
Employee may file a Compensation Deferral Agreement under this paragraph shall
be determined in accordance with the rules of Code Section 409A, including the
provisions of Treas. Reg. Section 1.409A-2(a)(7). An Eligible Employee may file
a Compensation Deferral Agreement only after being notified in writing by the
Company of his or her Eligibility under the Plan.

 

 

 

 

 

 

A Compensation Deferral Agreement filed under this paragraph applies to
Compensation earned on and after the date the Compensation Deferral Agreement
becomes irrevocable.

 

 

 

 

 

(b)

Prior Year Election. Except as otherwise provided in this Section 4.2,
Participants may defer Compensation by filing a Compensation Deferral Agreement
no later than December 31 of the year prior to the year in which the
Compensation to be deferred is earned. A Compensation Deferral Agreement
described in this paragraph shall become irrevocable with respect to such
Compensation as of January 1 of the year in which such Compensation is earned.

 

 

 

 

 

(c)

Performance-Based Compensation. Subject to Committee approval, Participants may
file a Compensation Deferral Agreement with respect to Performance-Based
Compensation no later than the date that is six months before the end of the
performance period, provided that:

 

 

 

 

 

 

(i)

the Participant performs services continuously from the later of the beginning
of the performance period or the date the criteria are established through the
date the Compensation Deferral Agreement is submitted; and

 

 

 

 

 

 

(ii)

the Compensation is not readily ascertainable as of the date the Compensation
Deferral Agreement is filed.

 

 

 

 

 

 

A Compensation Deferral Agreement becomes irrevocable with respect to
Performance-Based Compensation as of the day immediately following the latest
date for filing such election. Any election to defer Performance-Based
Compensation that is made in accordance with this paragraph and that becomes
payable as a result of the Participant’s death or upon a change of control (as
determined in Treas. Reg. Section 1.409A-3(i)(5)) prior to the satisfaction of
the performance criteria, will be void.

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(d)

Fiscal Year Compensation. Subject to Committee approval, a Participant may defer
Fiscal Year Compensation by filing a Compensation Deferral Agreement prior to
the first day of the fiscal year or years in which such Fiscal Year Compensation
is earned. The Compensation Deferral Agreement described in this paragraph
becomes irrevocable on the first day of the fiscal year or years to which it
applies.

 

 

 

 

(e)

Short-Term Deferrals. Subject to Committee approval, Compensation that meets the
definition of a “short-term deferral” described in Treas. Reg. Section
1.409A-1(b)(4) may be deferred in accordance with the rules of Article VII,
applied as if the date the Substantial Risk of Forfeiture lapses is the date
payments were originally scheduled to commence, provided, however, that the
provisions of Section 7.3 shall not apply to payments attributable to a change
of control (as determined in Treas. Reg. Section 1.409A-3(i)(5)).

 

 

 

 

(f)

Certain Forfeitable Rights. With respect to a legally binding right to a payment
in a subsequent year that is subject to a forfeiture condition requiring the
Participant’s continued services for a period of at least twelve months from the
date the Participant obtains the legally binding right, an election to defer
such Compensation may be made on or before the 30th day after the Participant
obtains the legally binding right to the Compensation, provided that the
election is made at least twelve months in advance of the earliest date at which
the forfeiture condition could lapse. The Compensation Deferral Agreement
described in this paragraph becomes irrevocable after such 30th day. If the
forfeiture condition applicable to the payment lapses before the end of the
required service period as a result of the Participant’s death or upon a change
of control (as determined in Treas. Reg. Section 1.409A-3(i)(5)), the
Compensation Deferral Agreement will be void unless it would be considered
timely under another rule described in this Section.

 

 

 

 

(g)

Company Awards. Participating Employers may unilaterally provide for deferrals
of Company awards prior to the date of such awards. Deferrals of Company awards
(such as sign-on or retention pay) may be negotiated with a Participant prior to
the date the Participant has a legally binding right to such Compensation.

 

 

 

 

(h)

“Evergreen” Deferral Elections. The Committee, in its discretion, may provide in
the Compensation Deferral Agreement that such Compensation Deferral Agreement
will continue in effect for each subsequent year or performance period. Such
“evergreen” Compensation Deferral Agreements will become effective with respect
to an item of Compensation on the date such election becomes irrevocable under
this Section 4.2. An evergreen Compensation Deferral Agreement may be terminated
or modified prospectively with respect to Compensation for which such election
remains revocable under this Section 4.2. A Participant whose Compensation
Deferral Agreement is cancelled in accordance with Section 4.6 will be required
to file a new Compensation Deferral Agreement under this Article IV in order to
recommence Deferrals under the Plan.

 

 

 

4.3

Allocation of Deferrals. A Compensation Deferral Agreement may allocate
Deferrals to one or more Specified Date Accounts and/or to the
Retirement/Termination Account subject to rules determined by the Committee. The
Committee may, in its discretion, establish a minimum deferral period for
Specified Date Accounts (for example, the third Plan Year following the year
Compensation subject to the Compensation Deferral Agreement is earned). The
Committee shall determine whether a deferral may be allocated to more than one
Specified Date Account or to a Specified Date Account and the Participant’s
Retirement/Termination Account.

 

 

 

4.4

Deductions from Pay. The Committee has the authority to determine the payroll
practices under which any component of Compensation subject to a Compensation
Deferral Agreement will be deducted from a Participant’s Compensation.

 

 

 

4.5

Vesting. Participant Deferrals shall be 100% vested at all times, unless
otherwise specified by the Company prior to the deferral being made.

 

 

 

4.6

Cancellation of Deferrals. The Committee shall cancel a Participant’s Deferrals
(i) for the balance of the Plan Year in which an Unforeseeable Emergency payment
is made, (ii) if the Participant receives a hardship distribution under the
Employer’s qualified 401(k) plan, through the end of the Plan Year in which the
six-month anniversary of the hardship distribution falls, and (iii) during
periods in which the Participant is unable to perform the duties of his or her
position or any substantially similar position due to a mental or physical
impairment that can be expected to result in death or last for a continuous
period of at least six months. In the event a Participant receives a voluntary
withdrawal from a Grandfathered Account, the Participant shall not be permitted
to make Deferrals to the Plan in the Plan Year following the Plan Year in which
the withdrawal is made.

 

 

 

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ARTICLE V

Company Contributions

 

 

 

5.1

Discretionary Company Contributions. The Participating Employer may, from time
to time in its sole and absolute discretion, credit Company Contributions to any
Participant in any amount determined by the Participating Employer. The Company
shall determine when Company Contributions shall be paid and whether or where
the Participant can invest the Company Contributions.

 

 

 

5.2

Vesting. Company Contributions described in Section 5.1, above, and the Earnings
thereon, shall vest in accordance with the vesting schedule(s) established by
the Committee or the Company at the time that the Company Contribution is made.
Absent the Committee’s or the Company’s designation otherwise, all Company
Contributions shall become 100% vested upon the occurrence of the earliest of:
(i) the death of the Participant while actively employed; (ii) Retirement of the
Participant, or (iii) a Change of Control. The Participating Employer may, at
any time, in its sole discretion, increase a Participant’s vested interest in a
Company Contribution. The portion of a Participant’s Accounts that remains
unvested upon his or her Separation from Service after the application of the
terms of this Section 5.2 shall be forfeited.

 

 

 

ARTICLE VI

Benefits

 

 

 

6.1

Benefits, Generally. A Participant shall be entitled to the following benefits
under the Plan:

 

 

 

 

(a)

Retirement Benefit. Upon the Participant’s Separation from Service due to
Retirement, he or she shall be entitled to a Retirement Benefit. The Retirement
Benefit shall be equal to the vested portion of the Retirement/Termination
Account and the vested portion of any Specified Date Accounts that are not yet
in pay status. The Retirement Benefit shall be based on the value of that
Account as of the end of the month in which Separation from Service occurs.
Payment of the Retirement Benefit will be made or begin during the month
following the month in which Separation from Service occurs, provided, however,
that with respect to a Participant who is a Specified Employee as of the date
such Participant incurs a Separation from Service, payment will be made or begin
during the seventh month following the month in which such Separation from
Service occurs. If the Retirement Benefit is to be paid in the form of
installments, any subsequent installment payments to a Specified Employee will
be paid on the anniversary of the date the initial installment was made.

 

 

 

 

(b)

Separation Benefit. Upon the Participant’s Separation from Service for reasons
other than death or Retirement, he or she shall be entitled to a Separation
Benefit. The Separation Benefit shall be equal to the vested portion of the
Retirement/Termination Account and the vested portion of any unpaid balances in
any Specified Date Accounts. The Separation Benefit shall be based on the value
of the Retirement/Termination Account as of the end of the month in which
Separation from Service occurs. Payment of the Separation Benefit will be made
or begin during the month following the month in which Separation from Service
occurs, provided, however, that with respect to a Participant who is a Specified
Employee as of the date such Participant incurs a Separation from Service,
payment will be made or begin during the seventh month following the month in
which such Separation from Service occurs.

 

 

 

 

(c)

Specified Date Benefit. If the Participant has established one or more Specified
Date Accounts, he or she shall be entitled to a Specified Date Benefit with
respect to each such Specified Date Account. The Specified Date Benefit shall be
equal to the vested portion of the Specified Date Account, based on the value of
that Account as of the end of the month designated by the Participant at the
time the Account was established. Payment of the Specified Date Benefit will be
made or begin during the month following the designated month. The Committee may
allow Participants to designate only the year of deferral and then make all
Specified Date elections payable during a Committee-designated month within such
year.

 

 

 

 

(d)

Death Benefit. In the event of the Participant’s death, his or her designated
Beneficiary(ies) shall be entitled to a Death Benefit. The Death Benefit shall
be equal to the vested portion of the Retirement/Termination Account and the
vested portion of any unpaid balances in any Specified Date Accounts. The Death
Benefit shall be based on the value of the Accounts as of the end of the month
in which death occurred, with payment made within 90 days of the date of death.

 

 

 

 

(e)

Unforeseeable Emergency Payments. A Participant who experiences an Unforeseeable
Emergency may submit a written request to the Committee to receive payment of
all or any portion of his or her vested Accounts. Whether a Participant or
Beneficiary is faced with an Unforeseeable Emergency permitting an emergency
payment shall be determined by the Committee based on the relevant facts and
circumstances of each case, but, in any case, a

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distribution on account of Unforeseeable Emergency may not be made to the extent
that such emergency is or may be reimbursed through insurance or otherwise, by
liquidation of the Participant’s assets, to the extent the liquidation of such
assets would not cause severe financial hardship, or by cessation of Deferrals
under this Plan. If an emergency payment is approved by the Committee, the
amount of the payment shall not exceed the amount reasonably necessary to
satisfy the need, taking into account the additional compensation that is
available to the Participant as the result of cancellation of deferrals to the
Plan, including amounts necessary to pay any taxes or penalties that the
Participant reasonably anticipates will result from the payment. The amount of
the emergency payment shall be subtracted first from the vested portion of the
Participant’s Retirement/Termination Account until depleted and then from the
vested Specified Date Accounts, beginning with the Specified Date Account with
the latest payment commencement date. Emergency payments shall be paid in a
single lump sum within the 90-day period following the date the payment is
approved by the Committee.

 

 

 

6.2

Form of Payment.

 

 

 

 

(a)

Retirement Benefit. A Participant who is entitled to receive a Retirement
Benefit shall receive payment of such benefit in a single lump sum, unless the
Participant elects on his or her initial or, to the extent allowed, his or her
subsequent Compensation Deferral Agreement to have such benefit paid in one of
the following alternative forms of payment (i) substantially equal annual
installments over a period of five (5) or ten (10), as elected by the
Participant; or (ii) to the extent allowed by the Committee a lump sum payment
of a percentage of the balance in the Retirement/Termination Account, with the
balance paid in substantially equal annual installments over a period of five
(5) or ten (10) as elected by the Participant.

 

 

 

 

(b)

Separation Benefit. A Participant who is entitled to receive a Separation
Benefit shall receive payment of such benefit in a single lump sum.

 

 

 

 

(c)

Specified Date Benefit. The Specified Date Benefit shall be paid in a single
lump sum, unless the Committee allows and the Participant elects on the
Compensation Deferral Agreement with which the account was established to have
the Specified Date Account paid in substantially equal annual installments.

 

 

 

 

 

Notwithstanding any election of a form of payment by the Participant, upon a
Separation from Service the unpaid balance of a Specified Date Account with
respect to which payments have not been made shall be aggregated and paid in
accordance with the form of payment applicable to the Retirement Benefit or
Termination Benefit, as applicable.

 

 

 

 

(d)

Death Benefit. A designated Beneficiary who is entitled to receive a Death
Benefit shall receive payment of such benefit in a single lump sum.

 

 

 

 

(e)

Change of Control. If the Change of Control meets the requirements of section
409A under the Code (“Qualifying Change of Control”), the following applies. A
Participant will receive a single lump sum payment equal to the unpaid balance
of all of his or her Accounts upon a Separation from Service within 24 months
following a Qualifying Change of Control. Subject to the payment rules for
Specified Employees under Section 6.1(a)Accounts will be valued as of the last
day of the month in which the Separation from Service occurs and payment will be
made within 45 days of such Separation from Service. In addition to the
foregoing, upon a Qualifying Change of Control, a Participant who has incurred a
Separation from Service prior to the Qualifying Change of Control, and any
Beneficiary of such Participant who is receiving or is scheduled to receive
payments, will receive the balance of all unpaid Accounts in a single lump sum.
Accounts will be valued as of the last day of the month following the Qualifying
Change of Control and will be paid within 45 days of said Qualifying Change of
Control.

 

 

 

 

(g)

Small Account Balances. Notwithstanding any prior Participant distribution
elections, if, on the date the Participant terminates from service or retires,
the aggregate of all Participant Accounts upon Separation from Service are
$50,000 or less (deemed to be “Small Account Balances”), the vested balance in
all Participant Accounts shall be distributed in a lump sum completely
liquidating the Participant’s interest in the Plan in the month immediately
following the end-of-month Valuation Date.

 

 

 

 

(h)

Rules Applicable to Installment Payments. If a Payment Schedule specifies
installment payments, annual payments will be made beginning as of the payment
commencement date for such installments and shall continue on each anniversary
thereof until the number of installment payments specified in the Payment
Schedule has been paid. The amount of each installment payment shall be
determined by dividing (a) by

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(b), where (a) equals the Account Balance as of the Valuation Date and (b)
equals the remaining number of installment payments.

 

 

 

 

 

For purposes of Article VII, installment payments will be treated as a single
form of payment. If a lump sum equal to less than 100% of the
Retirement/Termination Account is paid, the payment commencement date for the
installment form of payment will be the first anniversary of the payment of the
lump sum.

 

 

6.3

Acceleration of or Delay in Payments. The Committee, in its sole and absolute
discretion, may accelerate or delay the time of payment to the Participant
hereunder, only to the extent the acceleration or delay is permitted under
Treas. Reg. Section 1.409A-3(j)(4) or Section 1.409A-2(b)(7). If the Plan
receives a domestic relations order (within the meaning of Code Section
414(p)(1)(B)) directing that all or a portion of a Participant’s Accounts be
paid to an “alternate payee,” any amounts to be paid to the alternate payee(s)
shall be paid in a single lump sum.

 

 

ARTICLE VII

Modifications to Payment Schedules

 

 

7.1

Participant’s Right to Modify. A Participant may modify any or all of the
alternative Payment Schedules with respect to an Account, consistent with the
permissible Payment Schedules available under the Plan, provided such
modification complies with the requirements of this Article VII. The Committee
may impose limitations on the number of allowable modifications.

 

 

7.2

Time of Election. The date on which a modification election is submitted to the
Committee must be at least twelve months prior to the date on which payment is
scheduled to commence under the Payment Schedule in effect prior to the
modification.

 

 

7.3

Date of Payment under Modified Payment Schedule. Except with respect to
modifications that relate to the payment of a Death Benefit, the date payments
are to commence under the modified Payment Schedule must be no earlier than five
years after the date payment would have commenced under the original Payment
Schedule. Under no circumstances may a modification election result in an
acceleration of payments in violation of Code Section 409A.

 

 

7.4

Effective Date. A modification election submitted in accordance with this
Article VII is irrevocable upon receipt by the Committee and becomes effective
12 months after such date.

 

 

7.5

Effect on Accounts. An election to modify a Payment Schedule is specific to the
Account or payment event to which it applies, and shall not be construed to
affect the Payment Schedules of any other Accounts.

 

 

ARTICLE VIII

Valuation of Account Balances; Investments

 

 

8.1

Valuation. Deferrals shall be credited to appropriate Accounts on the date such
Compensation would have been paid to the Participant absent the Compensation
Deferral Agreement. Company Contributions shall be credited to the appropriate
Account at the times determined by the Committee. Valuation of Accounts shall be
performed under procedures approved by the Committee.

 

 

8.2

Earnings Credit. Each Account will be credited with Earnings on each Business
Day, based upon the Participant’s investment allocation among a menu of
investment options selected in advance by the Committee, in accordance with the
provisions of this Article VIII (“investment allocation”).

 

 

8.3

Investment Options. Investment options will be determined by the Committee. The
Committee, in its sole discretion, shall be permitted to add or remove
investment options from the Plan menu from time to time even if such removal
requires Participants to re-designate investment choices, provided that any such
additions or removals of investment options shall not be effective with respect
to any period prior to the effective date of such change.

 

 

8.4

Investment Allocations. A Participant’s investment allocation constitutes a
deemed, not actual, investment among the investment options comprising the
investment menu. At no time shall a Participant have any real or beneficial
ownership in any investment option included in the investment menu, nor shall
the Participating Employer or any trustee acting on its behalf have any
obligation to purchase actual securities as a result of a Participant’s
investment allocation. A Participant’s investment allocation shall be used
solely for purposes of adjusting the value of a Participant’s Account Balances.

 

 

 

A Participant shall specify an investment allocation for each of his Accounts in
accordance with procedures established by the Committee. Allocation among the
investment options must be designated in percentage increments designated by the

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Committee. The Participant’s investment allocation will become effective on the
same Business Day or, in the case of investment allocations received after a
time specified by the Committee, the next Business Day.

 

 

 

A Participant may change an investment allocation on any Business Day, both with
respect to future credits to the Plan and with respect to existing Account
Balances, in accordance with procedures adopted by the Committee. Changes shall
become effective on the same Business Day or, in the case of investment
allocations received after a time specified by the Committee, the next Business
Day, and shall be applied prospectively.

 

 

8.5

Unallocated Deferrals and Accounts. If the Participant fails to make an
investment allocation with respect to an Account, such Account shall be invested
in an investment option, the primary objective of which is the preservation of
capital, as determined by the Committee.

 

 

8.6

Company Stock. The Committee may include Company Stock as one of the investment
options described in Section 8.3. The Committee may, in its sole discretion,
limit the investment allocation of Company Contributions to Company Stock. The
Committee may also require Deferrals consisting of equity-based Compensation to
be allocated to Company Stock. The Committee may also restrict investments in
Company Stock to certain Participants and specify certain rules and limitations
on investment and sale of Company Stock to comply with securities laws.

 

 

8.7

Diversification. A Participant may re-allocate an investment in Company Stock
into another investment option subject to rules specified by the Committee. The
portion of an Account that is invested in Company Stock will be paid under
Article VI in the form of whole shares of Company Stock if the form of payment
elected is a lump sum. If the Participant elects to be paid with installments,
Company Stock will be paid under Article VI in the form of cash.

 

 

8.8

Dividend Equivalents. Dividend equivalents with respect to Company Stock will be
credited to the applicable Accounts in the form of additional shares or units of
Company Stock.

 

 

ARTICLE IX

Administration

 

 

9.1

Plan Administrator. This Plan shall be administered by the Committee which shall
have discretionary authority to make, amend, interpret and enforce all
appropriate rules and regulations for the administration of this Plan and to
utilize its discretion to decide or resolve any and all questions, including but
not limited to eligibility for benefits and interpretations of this Plan and its
terms, as may arise in connection with the Plan. Claims for benefits shall be
filed with the Committee and resolved in accordance with the claims procedures
in this Article IX. The Executive Compensation Committee of the Company’s Board
of Directors reserves the right to review all claims and appeals made by
Participants in compensation Band H and above.

 

 

9.02

Delegation of Authority. In the administration of this Plan, the Committee may,
from time to time, employ agents and delegate to them such administrative duties
as it sees fit, and may from time to time consult with legal counsel to the
Company.

 

 

9.03

Claim Procedure. Any controversy or claim arising out of or relating to the Plan
shall be filed in writing with the Committee which shall make all determinations
concerning such claim. Any claim filed with the Committee and any decision by
the Committee denying such claim shall be in writing and shall be delivered to
the Participant or Beneficiary filing the claim (the “Claimant”).

 

 

 

 

(a)

In General. Notice of a denial of benefits will be provided within ninety (90)
days of the Committee’s receipt of the Claimant’s claim for benefits. If the
Committee determines that it needs additional time to review the claim, the
Committee will provide the Claimant with a notice of the extension before the
end of the initial ninety (90) day period. The extension will not be more than
ninety (90) days from the end of the initial ninety (90) day period and the
notice of extension will explain the special circumstances that require the
extension and the date by which the Committee expects to make a decision.

 

 

 

 

(b)

Contents of Notice. If a claim for benefits is completely or partially denied,
notice of such denial shall be in writing and shall set forth the reasons for
denial in plain language. The notice shall (i) cite the pertinent provisions of
the Plan document and (ii) explain, where appropriate, how the Claimant can
perfect the claim, including a description of any additional material or
information necessary to complete the claim and why such material or information
is necessary. The claim denial also shall include an explanation of the claims

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review procedures and the time limits applicable to such procedures, including a
statement of the Claimant’s right to bring a civil action under Section 502(a)
of ERISA following an adverse decision on review.

 

 

 

 

(c)

Delegation. The Committee, unless provided otherwise, delegates to either the
Company’s legal counsel or appropriate personnel in the Total Rewards Dept. or
Employee Service Center to make an initial determination of all claims or
controversies arising under the Plan.

 

 

 

9.04

Appeal of Denied Claims. A Claimant whose claim has been completely or partially
denied shall be entitled to appeal the claim denial by filing a written appeal
with the Committee. A Claimant who timely requests a review of the denied claim
(or his or her authorized representative) may review, upon request and free of
charge, copies of all documents, records and other information relevant to the
denial and may submit written comments, documents, records and other information
relevant to the claim to the Committee. All written comments, documents,
records, and other information shall be considered “relevant” if the information
(i) was relied upon in making a benefits determination, (ii) was submitted,
considered or generated in the course of making a benefits decision regardless
of whether it was relied upon to make the decision, or (iii) demonstrates
compliance with administrative processes and safeguards established for making
benefit decisions. The Committee may, in its sole discretion and if it deems
appropriate or necessary, decide to hold a hearing with respect to the claim
appeal.

 

 

 

 

(a)

In General. Appeal of a denied benefits claim must be filed in writing with the
Committee no later than sixty (60) days after receipt of the written
notification of such claim denial. The Committee shall make its decision
regarding the merits of the denied claim within sixty (60) days following
receipt of the appeal (or within one hundred and twenty (120) days after such
receipt, in a case where there are special circumstances requiring extension of
time for reviewing the appealed claim). If an extension of time for reviewing
the appeal is required because of special circumstances, written notice of the
extension shall be furnished to the Claimant prior to the commencement of the
extension. The notice will indicate the special circumstances requiring the
extension of time and the date by which the Appeals Committee expects to render
the determination on review. The review will take into account comments,
documents, records and other information submitted by the Claimant relating to
the claim without regard to whether such information was submitted or considered
in the initial benefit determination.

 

 

 

 

(b)

Contents of Notice. If a benefits claim is completely or partially denied on
appeal, notice of such denial shall be in writing and shall set forth the
reasons for denial in plain language. The decision on appeal shall set forth (i)
the specific reason or reasons for the denial, (ii) specific references to the
pertinent Plan provisions on which the denial is based, (iii) a statement that
the Claimant is entitled to receive, upon request and free of charge, reasonable
access to and copies of all documents, records, or other information relevant
(as defined above) to the Claimant’s claim, and (iv) a statement describing any
voluntary appeal procedures offered by the plan and a statement of the
Claimant’s right to bring an action under Section 502(a) of ERISA.

 

 

 

 

 

Notice shall be deemed given as of the date of delivery or, if delivery is made
by mail, as of the date shown on the postmark on the receipt for registration or
certification. All appeals should be addressed to the Committee as follows:

 

 

 

Employee Benefits Committee

 

Pitney Bowes Pension Restoration Plan

 

Attn: Committee Secretary and Benefits Counsel

 

Pitney Bowes Inc. - Legal Dept.

 

One Elmcroft Road

 

Stamford, CT 06926

 

 

9.05

Exhaustion of Remedies. A participant may not bring any legal action relating to
a claim for benefits under the plan unless and until the participant has
followed the claims procedures under the Plan and exhausted his or her
administrative remedies under such claims procedures.

 

 

9.06

Indemnification. To the fullest extent permitted under Delaware law, the Company
shall indemnify and hold harmless each employee, officer, director, agent or
organization, to whom or to which are delegated duties, responsibilities, and
authority under the Plan or otherwise with respect to administration of the
Plan, including, without limitation, the Committee and its agents, against all
claims, liabilities, fines and penalties, and all expenses reasonably incurred
by or imposed upon him or it (including but not limited to reasonable attorney
fees) which arise as a result of his or its actions or failure to act in
connection with the operation and administration of the Plan to the extent
lawfully allowable and to the extent that such

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claim, liability, fine, penalty, or expense is not paid for by liability
insurance purchased or paid for by the Participating Employer. Notwithstanding
the foregoing, the Company shall not indemnify any person or organization if his
or its actions or failure to act are due to gross negligence or willful
misconduct or for any such amount incurred through any settlement or compromise
of any action unless the Company consents in writing to such settlement or
compromise.

 

 

9.07

Binding Decisions or Actions. The decision or action of the Committee in respect
of any question arising out of or in connection with the administration,
interpretation and application of the Plan and the rules and regulations
thereunder shall be final and conclusive and binding upon all persons having any
interest in the Plan. All benefits shall be made conditional upon the
participant’s acknowledgement, in writing or by acceptance of the benefits, that
all decisions and determinations of the Committee shall be final and binding on
the participant and his spouse, estate and any other person having or claiming
an interest under the Plan.

 

 

ARTICLE X

Amendment and Termination

 

 

10.1

Amendment. Pitney Bowes Inc. by action of its Board of Directors, appropriate
Board committee or as delegated to the Employee Benefits Committee, Trust
Investment Committee or management may at any time amend or modify this Plan in
whole or in part, if in its sole discretion such amendment or modification is
deemed necessary or desirable, provided, however, that no amendment shall be
effective to decrease the balance in any Account as accrued at the time of such
amendment. Amendments necessary to comply with law or to allow the orderly
administration of this Plan shall not be considered to be a reduction of
previously accrued benefit. Any amendment made to this Plan after a Change of
Control, as defined in the Pitney Bowes Senior Executive Severance Policy, or in
contemplation of a Change of Control shall not in any way adversely affect the
terms and conditions of this Plan as they exist prior to such amendment with
respect to benefits vested prior to such amendment.

 

 

10.02

Company’s Right to Terminate. The Board of Directors of the Company or the
Executive Committee of the Board may at any time terminate the Plan with respect
to future allocations to the account. The Board or the Executive Committee may
also terminate the Plan in its entirety at any time for any reason, and pay
Participants and Beneficiaries their Account Balances in a single lump sum at
any time, to the extent and in accordance with Treas. Reg. Section
1.409A-3(j)(4)(ix).

 

 

ARTICLE XI

Informal Funding

 

 

11.1

General Assets. Obligations established under the terms of the Plan may be
satisfied from the general funds of the Participating Employers, or a trust
described in this Article XI. No Participant, spouse or Beneficiary shall have
any right, title or interest whatever in assets of the Participating Employers.
Nothing contained in this Plan, and no action taken pursuant to its provisions,
shall create or be construed to create a trust of any kind, or a fiduciary
relationship, between the Participating Employers and any Employee, spouse, or
Beneficiary. To the extent that any person acquires a right to receive payments
hereunder, such rights are no greater than the right of an unsecured general
creditor of the Participating Employer.

 

 

11.2

Rabbi Trust. A Participating Employer may, in its sole discretion, establish a
grantor trust, commonly known as a rabbi trust, as a vehicle for accumulating
assets to pay benefits under the Plan. Payments under the Plan may be paid from
the general assets of the Participating Employer or from the assets of any such
rabbi trust. Payment from any such source shall reduce the obligation owed to
the Participant or Beneficiary under the Plan.

 

 

ARTICLE XII

General Provisions

 

 

12.1

Anti-assignment Rule. No interest of any Participant, spouse or Beneficiary
under this Plan and no benefit payable hereunder shall be assigned as security
for a loan, and any such purported assignment shall be null, void and of no
effect, nor shall any such interest or any such benefit be subject in any
manner, either voluntarily or involuntarily, to anticipation, sale, transfer,
assignment or encumbrance by or through any Participant, spouse or Beneficiary.
Notwithstanding anything to the contrary herein, however, the Committee has the
discretion to make payments to an alternate payee in accordance with the terms
of a domestic relations order (as defined in Code Section 414(p)(1)(B)).

 

 

12.2

No Legal or Equitable Rights or Interest. No Participant or other person shall
have any legal or equitable rights or interest in this Plan that are not
expressly granted in this Plan. Participation in this Plan does not give any
person any right to be retained in the service of the Participating Employer.
The right and power of a Participating Employer to dismiss or discharge an
Employee is expressly reserved. The Participating Employers make no
representations or warranties as to the tax consequences to a Participant or a
Participant’s beneficiaries resulting from a deferral of income pursuant to the
Plan.

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12.3

No Employment Contract. Nothing contained herein shall be construed to
constitute a contract of employment between an Employee and a Participating
Employer.

 

 

12.4

Headings. The headings of Sections are included solely for convenience of
reference, and if there is any conflict between such headings and the text of
this Plan, the text shall control.

 

 

12.5

Invalid or Unenforceable Provisions. If any provision of this Plan shall be held
invalid or unenforceable, such invalidity or unenforceability shall not affect
any other provisions hereof and the Committee may elect in its sole discretion
to construe such invalid or unenforceable provisions in a manner that conforms
to applicable law or as if such provisions, to the extent invalid or
unenforceable, had not been included.

 

 

12.6

Lost Participants or Beneficiaries. Any Participant or Beneficiary who is
entitled to a benefit from the Plan has the duty to keep the Committee advised
of his or her current mailing address. If benefit payments are returned to the
Plan or are not presented for payment after a reasonable amount of time, the
Committee shall presume that the payee is missing. The Committee, after making
such efforts as in its discretion it deems reasonable and appropriate to locate
the payee, shall stop payment on any uncashed checks and may discontinue making
future payments until contact with the payee is restored.

 

 

12.7

Facility of Payment to a Minor. If a distribution is to be made to a minor, or
to a person who is otherwise incompetent, then the Committee may, in its
discretion, make such distribution (i) to the legal guardian, or if none, to a
parent of a minor payee with whom the payee maintains his or her residence, or
(ii) to the conservator or committee or, if none, to the person having custody
of an incompetent payee. Any such distribution shall fully discharge the
Committee, the Company, and the Plan from further liability on account thereof.

 

 

12.8

Accounts Taxable Under Code Section 409A. This Plan is intended to comply with
section 409A of the Code and shall in all respects be administered in accordance
with section 409A, including the requirement that payments to a “specified
employee” of a publicly traded corporation upon separation from service be
delayed for a period of six months after separation from service.
Notwithstanding anything in the Plan to the contrary, distributions may only be
made under the Plan upon an event and in a manner permitted by section 409A of
the Code. All payments to be made upon termination of employment under this Plan
may only be made upon “separation from service” under section 409A. In no event
may a participant, directly or indirectly, designate the calendar year of a
payment, except pursuant to payment elections permitted under section 409A of
the Code.

 

 

12.9

Governing Law. To the extent not preempted by ERISA, the laws of the State of
Connecticut shall govern the construction and administration of the Plan.

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APPENDIX A

 

PITNEY BOWES INC.

 

DEFERRED INCENTIVE SAVINGS PLAN

 

FOR PRE-2005 DEFERRALS

 

As Amended and Restated

Effective January 1, 2003

 

(Previously amended and Restated Effective January 1, 2000)

 

(DCPP12)

 

PITNEY BOWES INC.

DEFERRED INCENTIVE SAVINGS PLAN

(As amended and restated effective as of January 1, 2003)

 

ARTICLE I

 

INTRODUCTION

                    The purpose of the Pitney Bowes Inc. Deferred Incentive
Savings Plan (hereinafter referred to as the “Plan”) is to aid Pitney Bowes Inc.
and its subsidiaries in retaining and attracting executive employees by
providing them with savings and tax deferral opportunities. The Plan first
became effective for deferral elections made hereunder on or after September 9,
1996. The Plan has been amended and restated from time to time. The Plan was
amended and restated to incorporate previous amendments and to make additional
changes, effective for deferral elections made hereunder on or after January 1,
2000. The Plan was further amended and restated to incorporate amendments and
clarifications effective for deferral elections made hereunder on or after
November 1, 2002. Participants who made a deferral election and incurred a
Termination of Employment or Disability, entered Retirement or died prior to the
effective date of any amendments shall have their deferrals and distributions
governed by the terms of the Plan in effect prior to the effective date of any
amendments. Effective the effective date of any amendments, the term “PBC” will
no longer be used to describe the annual incentive compensation deferred under
the Plan. Instead, annual incentive compensation will be known as Pitney Bowes
Incentive Program.

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ARTICLE II

DEFINITIONS

                    For the purposes of this Plan, the following words and
phrases shall have the meanings indicated, unless the context clearly indicates
otherwise:

                    Section 2.01 Account. “Account” means the bookkeeping
account(s) established on the books of the Company by the Administrative
Committee on behalf of the Participant comprised of the Deferral Account and the
Gain Share Account. Accounts and Sub-Accounts will be established when the
Deferred Amount would otherwise have been paid.

                    Section 2.02 Administrative Committee. “Administrative
Committee” means the committee comprised of the Senior Vice President and Chief
Human Resources Officer, Vice President and Treasurer, Vice President Employee
Brand and Total Rewards, Director Strategic Leadership Total Rewards.

                    Section 2.03 Annual Incentive Award. “Annual Incentive
Award” means the annual cash incentive payable to a Participant.

                    Section 2.04 Base Salary. “Base Salary” means the base
salary of a Participant described in Section 4.01 (ii) of the Plan in effect at
the time of the deferral rather than in effect at the time of the election to
defer.

                    Section 2.05 Beneficiary. “Beneficiary” means the person,
persons or entity designated by the Participant to receive any benefits payable
under the Plan pursuant to Article VIII.

                    Section 2.06 Board. “Board” means the Board of Directors of
Pitney Bowes Inc.

                    Section 2.07 CIU Award. “CIU Award” means any Cash Incentive
Unit Award granted pursuant to the long-term incentive program under the Pitney
Bowes Inc. Key Employees’ Incentive Plan (as amended and restated as of February
12, 2001).

                    Section 2.08 Change of Control. For purposes of this Plan, a
“Change of Control” shall be deemed to have occurred if:

 

 

 

(i) there is an acquisition, in anyone transaction or a series of transactions,
other than from Pitney Bowes Inc., by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”)), of beneficial ownership (within the
meaning of Rule 13(d)(3) promulgated under the Exchange Act) of 20% or more of
either the then outstanding shares of Common Stock or the combined voting power
of the then outstanding voting securities of Pitney Bowes Inc. entitled to vote
generally in the election of directors, but excluding, for this purpose, any
such acquisition by Pitney Bowes Inc. or any of its subsidiaries, or any
employee benefit plan (or related trust) of Pitney Bowes Inc. or its
subsidiaries, or any corporation with respect to which, following such
acquisition, more than 50% of the then outstanding shares of common stock of
such corporation and the combined voting power of the then outstanding voting
securities of such corporation entitled to vote generally in the election of
directors is then beneficially owned, directly or indirectly, by the individuals
and entities who were the beneficial owners, respectively, of the common stock
and voting securities of Pitney Bowes Inc. immediately prior to such acquisition
in substantially the same proportion as their ownership, immediately prior to
such acquisition, of the then outstanding shares of Common Stock or the combined
voting power of the then outstanding voting securities of Pitney Bowes Inc.
entitled to vote generally in the election of directors, as the case may be; or

 

 

 

(ii) individuals who, as of January 1, 2002, constitute the Board (as of such
date, the “Incumbent Board”) cease for any reason to constitute at least a
majority of the Board, provided that any individual becoming a director
subsequent to January 1, 2002, whose election, or nomination for election by
Pitney Bowes’ shareholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office is in connection
with an actual or threatened election contest relating to the election of the
directors of Pitney Bowes Inc. (as such terms are used in Rule 14(a)(11) or
Regulation 14A promulgated under the

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  Exchange Act); or    

 

(iii) there occurs either (a) the consummation of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company, in each case, with respect to which the individuals and
entities who were the respective beneficial owners of the common stock and
voting securities of Pitney Bowes Inc. immediately prior to such reorganization,
merger or consolidation do not, following such reorganization, merger or
consolidation, beneficially own, directly or indirectly, more than 50% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such reorganization, merger or consolidation, or (b) an approval
by the shareholders of Pitney Bowes Inc. of a complete liquidation of
dissolution of Pitney Bowes Inc. or of the sale or other disposition of all or
substantially all of the assets of Pitney Bowes Inc.

                    Section 2.09 Common Stock. “Common Stock” means the common
stock of Pitney Bowes Inc.

                    Section 2.10 Company. “Company” means Pitney Bowes Inc., its
successors, any subsidiary or affiliated organizations authorized by the Board
or the Executive Committee to participate in the Plan and any organization into
which or with which Pitney Bowes Inc. may merge or consolidate or to which all
or substantially all of its assets may be transferred.

                    Section 2.11 Consideration Shares. “Consideration Shares”
means shares of Common Stock owned by the Participant for a period of at least
six months prior to the Date of Exercise, and having a Fair Market Value equal
to the exercise price for the number of Option Shares to be exercised.

                    Section 2.12 Date of Exercise. “Date of Exercise” means the
date on which an Option is considered to be exercised.

                    Section 2.13 Deferral Account. “Deferral Account” means the
total of all Sub­Accounts maintained on the books of the Company by the
Administrative Committee for each Participant to reflect deferral of Eligible
Compensation, adjusted for hypothetical gains, earnings, dividends, losses,
distributions, withdrawals and other similar activity other than gains with·
respect to stock options granted pursuant to deferrals made under the Plan.

                    Section 2.14 Deferral Period. “Deferral Period” means the
period beginning on the date the Eligible Compensation would otherwise have been
paid or, in the case of Gain Shares, on the Date of Exercise, and ending on the
earlier of (i) the Participant’s Retirement and (ii) the last day of the period
during which the Participant elected to defer current enjoyment and distribution
of the Eligible Compensation and Gain Shares

                    Section 2.15 Deferred Amount. “Deferred Amount” means the
amount of Eligible Compensation for the Plan Year or performance period to which
the Participation Agreement relates that is to be deferred under the Plan.

                    Section 2.16 Disability. “Disability” means eligibility for
disability benefits under the terms of the Company’s Long-Term Disability Plan
as in effect from time to time.

                    Section 2.17 Eligible Compensation. “Eligible Compensation”
means any cash award otherwise payable as annual incentive compensation or a CIU
Award by the Company to a Participant with respect to a Plan Year or a
performance period pursuant to the Pitney Bowes Inc. Key Employees’ Incentive
Plan or, effective January 1, 2000, Base Salary otherwise payable to the
Participant.

                    Section 2.18 ERISA. “ERISA” means the Employee Retirement
Income Security Act of 1974, as amended.

                    Section 2.19 Executive Committee. “Executive Committee”
means the Executive Compensation Committee of the Board.

                    Section 2.20 Fair Market Value. “Fair Market Value” of a
share of Common Stock means the closing price of the Common Stock on the New
York Stock Exchange on the most recent day on which the Common Stock was so
traded that precedes the date as of which Fair Market Value is to be determined.

                    Section 2.21 Form of Payment. “Form of Payment” means, with
respect to In­Service Distributions, payment in one lump sum or in 5 annual
installments, and with respect to Retirement distributions, payments in a lump
sum, a partial lump sum, and/or in annual installments of 5, 10 or 15 years.

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                    Section 2.22 Gain Shares. “Gain Shares” means the shares of
Common Stock resulting from the exercise of any option pursuant to Article V.

                    Section 2.23 Gain Share Account. “Gain Share Account” means
the account maintained on the books of the Company by the Administrative
Committee for the Participant to reflect the number of Phantom Share Units
related to Gains Shares, adjusted for hypothetical gains, earnings, dividends,
losses, distributions, withdrawals and other similar activity.

                    Section 2.24 In-Service Distribution. “In-Service
Distribution” means a payment by the Company to the Participant following a date
elected by the Participant (the In­Service Distribution Date) of the amount
represented by the Account balance in the In-Service Fund Sub-Account or
In-Service Option Sub-Account pertaining to that In-Service Distribution.
In-Service Distributions shall be made in accordance with Participants’
In-Service Distribution Form of Payment election.

                    Section 2.25 In-Service Fund Sub-Account. “In-Service Fund
Sub-Account” or “Fund Sub-Account” means an Account created to track Deferred
Amounts allocated to hypothetical investments other than Options, and
hypothetical earnings thereon, which the Participant elects to receive as an
In-Service Distribution.

                    Section 2.26 In-Service Option Sub-Account. “In-Service
Option Sub- Account” or “Option Sub-Account” is an Account created to track
Deferred Amounts allocated to Options.

                    Section 2.27 Option. “Option” means an option to acquire
shares of Common Stock granted pursuant to the Pitney Bowes Stock Option Plan as
amended and restated January, 2002 or any predecessor or successor thereto.

                    Section 2.28 Option Expiration Date. “Option Expiration
Date” means the last day of the option term.

                    Section 2.29 Option Share. “Option Share” means a share of
Common Stock acquired (or deferred hereunder) pursuant to the exercise of an
Option.

                    Section 2.30 PBIP. “PBIP” means the Pitney Bowes’
Performance Based Compensation Incentive Program, or any successor thereto, and
the “PBIP-like” compensation incentive program, or any successor thereto.

                    Section 2.31 Participant. “Participant” means any individual
who is eligible to participate in this Plan and who elects to participate by
filing a Participation Agreement or Stock Option Gain Agreement as provided in
Article N.

                    Section 2.32 Participation Agreement. “Participation
Agreement” means an agreement filed by a Participant in accordance with Article
N.

                    Section 2.33 Phantom Share Fund. “Phantom Share Fund” means
the hypothetical investment fund under the Plan which is comprised of Phantom
Share Units and which is intended to mirror investment in Common Stock,
including deemed reinvestment of dividends thereon.

                    Section 2.34 Phantom Share Unit. “Phantom Share Unit” means
the accounting units established hereunder to track a Participant’s hypothetical
interest in the Phantom Share Fund.

                    Section 2.35 Plan Year. “Plan Year” means a twelve-month
period beginning January 1 and ending the following December 31; provided that
the first Plan Year shall be the partial year beginning on September 9, 1996 and
ending on December 31, 1996.

                    Section 2.36 Retirement. “Retirement” means retirement of a
Participant from the Company after attaining age 65 or 55 with at least ten
years of service (in accordance with the method of determining retirement under
the Pitney Bowes Pension Plan).

                    Section 2.37 Retirement Sub-Account. “Retirement
Sub-Account” means an Account created to track all Deferred Amounts, and
hypothetical earnings thereon, that Participants elect to receive upon
Retirement or are otherwise not credited to an In-Service Sub­Account or to an
Option Sub-Account.

                    Section 2.38 Stock Option Gain Agreement. “Stock Option Gain
Agreement” means an agreement filed by a Participant in accordance with Article
V intended to defer taxation of the gain from the exercise of an Option.

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                    Section 2.39 Sub-Account. “Sub-Account” means an Account
that is a portion of the Deferral Account created and maintained for purposes of
enabling different allocation elections (among hypothetical investment funds),
different Form of Payment elections, and different distribution dates, or for
other reasons deemed necessary by the Administrative Committee to properly
administer the Plan.

                    Section 2.40 Termination of Employment. “Termination of
Employment” means the cessation of a Participant’s services as a full-time
employee of the Company and its affiliates for any reason other than Retirement.

                    Section 2.41 Unforeseeable Emergency. “Unforeseeable
Emergency” means severe financial hardship to the Participant resulting from a
sudden and unexpected illness or accident of the Participant or a dependent of
the Participant, loss of the Participant’s property due to casualty, or other
similar extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the Participant.

                    Section 2.42 Valuation Date. “Valuation Date” means the last
day of the calendar month immediately preceding a distribution triggering event
(e.g. an In-Service Distribution Date, the end of an Option Sub-Account Deferral
Period, Retirement, Termination of Employment, Death, or Disability) or such
other date as the Administrative Committee in its sole discretion may determine.

ARTICLE III

ADMINISTRATION

                    Section 3.01 Executive and Administrative Committees;
Duties. The Executive Committee shall administer this Plan and shall be the
named fiduciary of this Plan. A majority of the members of the Executive
Committee shall constitute a quorum for the transaction of business. All
resolutions or other action taken by the Executive Committee shall be by a vote
of a majority of its members present at any meeting or, without a meeting, by an
instrument in writing signed by all its members. Members of the Executive
Committee may participate in a meeting of such committee by means of a
conference telephone or similar communications equipment that enables all
persons participating in the meeting to hear each other, and such participation
in a meeting shall constitute presence in person at the meeting.

                    The Executive Committee shall be responsible for the
administration of this Plan and shall have all powers necessary to administer
this Plan, including discretionary authority to determine eligibility for
benefits and to decide claims under the terms of this Plan, except to the extent
that any such powers are vested in any other fiduciary of this Plan by the
Executive Committee. The Executive Committee may from time to time establish
rules for the administration of this Plan, and it shall have the exclusive right
to interpret this Plan and to decide any matters arising in connection with the
administration and operation of this Plan. All rules, interpretations and
decisions of the Executive Committee shall be conclusive and binding on the
Company, Participants and Beneficiaries.

                    The Executive Committee has delegated to the Administrative
Committee responsibility for performing certain administrative and ministerial
functions under this Plan. The Administrative Committee shall be responsible for
determining in the first instance issues related to eligibility, deemed
investment choices, determination and distribution of Account balances,
crediting of hypothetical earnings and debiting of hypothetical losses,
in-service withdrawals, deferral elections and any other duties concerning the
day-to-day operation of the Plan. The Executive Committee shall have discretion
to delegate to the Administrative Committee such additional duties as it may
determine. The Administrative Committee may designate one of its members as a
chairperson and may retain and supervise outside providers and professionals
(including in-house professionals) to perform any or all of the duties delegated
to it hereunder.

                    Neither the Executive Committee nor a member of the Board
nor any member of the Administrative Committee shall be liable for any act or
action hereunder, whether of omission or commission, by any other member or
employee or by any agent to whom duties in connection with the administration of
this Plan have been delegated or for anything done or omitted to be done in
connection with this Plan. The Executive Committee and the Administrative
Committee shall keep records of all of their respective proceedings and the
Administrative Committee shall keep records of all payments made to Participants
or Beneficiaries and payments made for expenses or otherwise.

                    The Company shall, to the fullest extent permitted by law,
indemnify each director, officer or employee of the Company (including the
heirs, executors, administrators and other personal representatives of such
person) and each member of the Executive Committee and the Administrative
Committee against expenses (including attorneys’ fees), judgments, fines,
amounts paid

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in settlement, actually and reasonably incurred by such person in connection
with any threatened, pending or actual suit, action or proceeding (whether
civil, criminal, administrative or investigative in nature or otherwise) in
which such person may be involved by reason of the fact that he or she is or was
serving this Plan in any capacity at the request of the Company.

                    Any expense incurred by the Company, the Executive Committee
or the Administrative Committee relative to the administration of this Plan
shall be paid by the Company.

                    Section 3.02 Claim Procedure. If a Participant or
Beneficiary makes a written request alleging a right to receive payments under
this Plan or alleging a right to receive an adjustment in benefits being paid
under this Plan, such actions shall be treated as a claim for benefits. All
claims for benefits under this Plan shall be sent to the Administrative
Committee. If the Administrative Committee determines that any individual who
has claimed a right to receive benefits, or different benefits, under this Plan
is not entitled to receive all or any part of the benefits claimed, the
Administrative Committee shall inform the claimant in writing of such
determination and the reasons therefore in terms calculated to be understood by
the claimant. The notice shall be sent within 90 days of the claim unless the
Administrative Committee determines that additional time, not exceeding 90 days,
is needed. The notice shall make specific reference to the pertinent Plan
provisions on which the denial is based, and shall describe any additional
material or information that is necessary. Such notice shall, in addition,
inform the claimant of the procedure that the claimant should follow to take
advantage of the review procedure set forth below in the event the claimant
desires to contest the denial of the claim. Such notice shall further inform the
claimant of his or her right to bring a civil action under ERISA Section 502(a)
following an adverse benefit determination on appeal. The claimant may within 90
days thereafter submit in writing to the Administrative Committee a notice that
the claimant contests the denial of his or her claims and desires a further
review by the Executive Committee. The Executive Committee shall within 60 days
thereafter review the claim and authorize the claimant to review relevant
documents and submit issues, comments, documents and other information relating
to the claim to the Executive Committee. The Executive Committee will render a
final decision on behalf of the Company with specific reasons therefore in
writing and will transmit it to the claimant within 60 days of the written
request for review, unless the Chairperson of the Executive Committee determines
that additional time, not exceeding 60 days, is needed, and so notifies the
claimant. If the claim is denied, wholly or in part, the notice shall further
include specific references to the pertinent Plan provisions on which the denial
is based, shall include a statement that the claimant is entitled to receive or
review, upon request, documents relevant to the claim, and a statement of the
claimant’s right to bring a civil action under ERISA Section 502(a). If the
Committee fails to respond to a claim filed in accordance with the foregoing
within 60 days or. any such extended period, the Company shall be deemed to have
denied the claim.

ARTICLE IV

PARTICIPATION AND DEFERRAL OF ELIGIBLE COMPENSATION

                    Section 4.01 Participation. Participation in the Plan shall
be limited to executives who

 

 

 

 

(a)

meet such eligibility criteria as the Executive Committee shall establish from
time to time,

 

 

 

 

(b)

in the case of deferral of Base Salary, are individuals whose compensation may
be subject to the deductibility limitations of Section 162(m) of the Internal
Revenue Code, as amended, and

 

 

 

 

(c)

elect to Participate in the Plan by filing a Participation Agreement or a Stock
Option Gain Agreement with the Administrative Committee. A Participation
Agreement must be filed

 

 

 

 

 

(i) with respect to an Annual Incentive Award, prior to the December 1st
immediately preceding the Plan Year with respect to which the award relates and

 

 

 

 

 

(ii) with respect to a CIU Award, prior to the December 1st that occurs during
the year prior to the last year of the performance period to which the award
relates.

 

 

 

Prior to January 1, 2001, the term “PBC award” was used to describe the annual
incentive award that could be offered under the Plan. The Participation
Agreement for deferral of awards and CIU Awards that would otherwise be payable
in 1997 was required to be filed no later than December 1, 1996. The
Administrative Committee shall have the discretion to establish special
deadlines regarding the filing of Participation Agreements for specified groups
of Participants.

 

 

                    Section 4.02 Contents of Participation Agreement. Each
Participation Agreement shall set forth:

 

 

 

 

 

(i) the Deferred Amount, expressed as either a dollar amount or a percentage of
the total Eligible Compensation for

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such Plan Year or performance period; provided, that the minimum Deferred Amount
for any Plan Year or performance period shall not be less than $2,000;

 

 

 

 

 

(ii) the In-Service Distribution Date(s) and/or Deferral Period for portions, or
all, of the Deferred Amount, which is not to be less than three years,

 

 

 

 

 

(iii) the Form of Payment for In-Service Distributions and Retirement
distribution;

 

 

 

 

 

(iv) investment selections made by the Participant in hypothetical investment
funds under the Plan; and

 

 

 

 

 

(v) and any other item determined to be appropriate by the Administrative
Committee.

                    Section 4.03 In-Service Distributions. An In-Service
Distribution election shall pertain to such portion of the Deferred Amount as
elected by the Participant and shall cause a Fund Sub-Account or an Option
Sub-Account, as the case may be, to be established (unless such Sub-Account
already exists), to which such portion of Deferred Amount shall be credited. In
the event an In-Service Sub-Account has already been established for the
In-Service Distribution Date referred to in the deferral election, such portion
of the Deferred Amount shall be credited to the existing In-Service Sub-Account.

 

 

 

 

(a)

A Participant may maintain up to four (4) Fund Sub-Accounts and an unlimited
number of Option Sub-Accounts.

 

 

 

 

(b)

The minimum Deferral Period for an In-Service Distribution is three years.

 

 

 

 

(c)

A Participant may change an In-Service Distribution Date or Form of Payment once
only, as follows:

 

 

 

 

 

(i) An In-Service Distribution Date extension may be requested by submitting a
new Participation Agreement or such other form as may be provided for In­Service
Distribution Date extensions by the Administrative Committee (or completing and
electronically submitting the appropriate screen on the Participant website,
when available) at any time, so long as the date that such form is submitted is
at least twelve (12) months prior to the In-Service Distribution Date being
extended; and

 

 

 

 

 

(ii) The In-Service Distribution Date may be extended to a subsequent year (and
must be extended by at least one year), but it may not be accelerated (made to
occur sooner than the original date). An extension of an In-Service Distribution
Date corresponding to an Option Sub-Account will not extend the Option term.

 

 

 

 

 

(iii) In-Service Distribution Dates corresponding to Fund Sub-Accounts may be
cancelled, even after an extension. A cancellation of such an In-Service
Distribution Date shall cause the Fund Sub-Account associated with it to be
combined with the Retirement Sub-Account.

 

 

 

 

 

(iv) In-Service Distribution Dates corresponding to Option Sub-Accounts may not
be cancelled.

 

 

 

 

 

(v) Extending or canceling an In-Service Distribution Date in accordance with
the Plan is specific to the In-Service Distribution to which it refers, and
shall not affect other In-Service Distribution Dates or the ability of the
Participant to make new In-Service Distribution elections with respect to new
Deferred Amounts (except to the extent the maximum number of In-Service Fund
Sub-Accounts are already established).

 

 

 

 

 

(vi) With the exception that Fund Sub-Account cancellations do not count as a
change, only one change may be made for each In Service Sub-Account. More than
one change (that is otherwise permitted under the Plan) may be made if made
concurrently with other permissible changes (e.g. a Form of Payment change may
be made in the same request as a request for a date extension). If made
separately, any change (other than a cancellation of a Fund Sub-Account)
constitutes a change to the In-Service Distribution and thereby extinguishes a
Participant’s right to request any additional change at another time.

 

 

 

 

(d)

Any portion of a Deferred Amount not credited to an Fund Sub-Account or an
Option Sub-Account will be credited to the Retirement Sub-Account.

 

 

 

 

(e)

The Participation Agreement shall also indicate the Participant’s Form of
Payment election for each In-Service Distribution Date. Permitted payment
schedules for In-Service Distributions are a single lump sum or five (5) annual
installment payments.

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(f)

In-Service Distributions corresponding to Fund Sub-Accounts shall be accelerated
in the event of Retirement or Termination of Employment. In the event Retirement
occurs prior to an In-Service Distribution Date, or prior to the completion of
payment of an In-Service Distribution (in the case of installment payments) with
respect to an Fund Sub-Account, the remaining balances in the Fund Sub-Accounts
shall be added to the Retirement Sub-Account. Payments shall thereafter be made
by the Company in accordance with Plan provisions regarding Retirement or
Termination of Employment, as the case may be.

 

 

 

 

(g)

In-Service Distributions corresponding to In-Service Option Sub-Accounts shall
not be accelerated in the event of Retirement, but shall be accelerated in the
event of Termination of Employment, death, or Disability prior to Retirement.

 

 

 

                    Section 4.04 Options and Deferral Periods.

 

 

 

 

(a)

A Participant may allocate a portion, or all, of a Deferred Amount to options,
if such hypothetical investment is made available by the Executive Committee
(see Section 7.02(c)). When a Participant allocates Deferred Amounts to Options,
the Participant must elect a Deferral Period, which must be at least three years
but no more than ten years beginning on the date the Deferred Amount (or last
installment of the Deferred Amount in the case of salary), is credited to the
Deferral Account. The Deferral Period will also determine the term of the
Option; however, if the minimum Deferral Period of three years is chosen, then
the Option term will be four years.

 

 

 

 

(b)

The allocation to Options and establishment of a corresponding Deferral Period
creates an Option Sub-Account. There is no limit on the number of Option
Sub­Accounts which a Participant may maintain.

 

 

 

 

(c)

Option Sub-Accounts established prior to January 1, 2004 will be accelerated and
combined with Retirement payments in progress (or, if none, then paid in
accordance with the Participant’s Fonn of Payment election for the Option
Sub-Account) in the event of exercise of the Option following Retirement. For
Option Sub-Accounts established on or after January 1, 2004, Option Sub-Account
distributions shall not be accelerated due to Retirement or exercise of the
Option following Retirement.

                    Section 4.05 Changes to Participation Agreement. Provisions
of a Participation Agreement pertaining to the amount and source (e.g. salary,
specific award, etc.) of Deferred Amounts may not be amended or revoked after
the beginning of the Plan Year to which they pertain. Changes to the In-Service
Distribution Dates, and Form of Payment elections for In-Service Distributions
and Retirement distributions may be made in accordance with provisions in
applicable Sections of the Plan.

                    Section 4.06 Reduction in Deferred Amount for Tax
Withholding. The foregoing provisions of this Article IV notwithstanding, in the
event a Participant’s deferral election results in insufficient non-deferred
compensation from which to withhold taxes in accordance with applicable law, the
Deferred Amount shall be reduced as necessary to allow the Company to satisfy
tax withholding requirements.

ARTICLE V

STOCK OPTION GAIN DEFERRALS

                    Section 5.01 In General. Subject to provisions of this
Article V, .Participants may elect to defer receipt and distribution of the gain
related to Gain Shares until the end of an elected Deferral Period by filing
with the Administrative Committee a Stock Option Gain Agreement. The stock
option gain deferral features of the Plan are effective for deferral elections
made on or after September 14, 1998. The deferral of gain related to Gain
Shares, as described in Article V and other related provisions of the Plan,
shall be available only to Participants who are employees of the Company at the
time the Participant files a Stock Option Gain Agreement.

                    Section 5.02 Timing of Filing Stock Option Gain Agreement. A
Stock Option Gain Agreement must be filed at least six months prior to the Date
of Exercise, prior to the calendar year in which occurs the Date of Exercise and
no later than the day before the first day of the six month period ending on the
Option Expiration Date.

                    Section 5.03 Contents of Stock Option Gain Agreement. Each
Stock Option Gain Agreement shall set forth: (i) the number of Option Shares to
be exercised in connection with the deferrals hereunder; (ii) the date of grant
of the Option Shares; (iii) the Deferral Period, which is not to be less than
three years; (iv) the Form of Payment; and (v) any other item determined to be
appropriate by the Administrative Committee. A Participant may elect to defer
gain on Option Shares in increments of 25%, 50%,

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75% or 100% of the number of Option Shares awarded on a particular date of
grant.

                    Section 5.04 Manner of Exercising Option Shares. A
Participant who desires to exercise an Option and to defer current receipt and
distribution of the gain related to Gain Shares must follow the procedures and
requirements that are applicable to the Option under the Pitney Bowes Stock Plan
as amended and restated, January 1, 2002, including the procedures and
requirements relating to the exercise of an Option; provided, however, that in
the case of a deferral of Gain Shares under this Plan, the Participant shall
only be permitted to tender Consideration Shares to pay the entire exercise
price for any exercised Option. Notwithstanding the foregoing, the
Administrative Committee may in its discretion accept the Participant’s
attestation that he or she owns the number of Consideration Shares necessary to
effectuate the stock swap contemplated hereunder. The attestation method or any
other procedure accepted by the Administrative Committee shall be consistent
with applicable legal authority regarding the tax - free treatment of such a
transaction.

                    Section 5.05 Determination of Gain Shares. Upon exercise of
an Option, the gain of which the Participant has elected to defer hereunder,
Gain Shares resulting from such exercise shall be determined as follows: (i) the
aggregate exercise price for all exercised Option Shares shall be determined;
(ii) the number of Consideration Shares needed to pay the exercise price for
such Option Shares shall be determined; (iii) the difference between the number
of exercised Option Shares and the number of Consideration Shares shall be the
number of Gain Shares resulting from such exercise. Any fractional Gain Share
that results from the computations hereunder shall be rounded up to the nearest
whole number.

                    Section 5.06 Conversion of Gain Shares to Phantom Stock
Units. As of the Date of Exercise, Gain Shares shall be converted to Phantom
Share Units by dividing the amount of the aggregate Fair Market Value of the
Gain Shares as of the Date of Exercise by the Fair Market Value of one share of
Common Stock as of the Date of Exercise. The resulting number of Phantom Share
Units shall be credited to the Participant’s Gain Share Account. Any fractional
Phantom Share Unit that results from the computations hereunder shall be rounded
up to the nearest whole number.

                    Section 5.07 Changes to the Stock Option Gain Agreement. A
Stock Option Gain Agreement may not be amended or revoked after the day on which
it is filed with the Administrative Committee, except that the Deferral Period
may be extended if an amended Stock Option Gain Agreement is filed with the
Administrative Committee at least one full calendar year before the Deferral
Period (as in effect before such amendment) ends; provided, that only one such
amended Stock Option Deferral Agreement may be filed with respect to each
Agreement.

                    Section 5.08 Failure to Properly Exercise. If a Participant
who has made a valid election under this Article V to defer the gain related to
Gain Shares and if the Option expires without a proper exercise of the Option by
the Participant or if the Participant fails to properly tender the Consideration
Shares by the last day of the Option term, the Participant shall forfeit any
opportunity to exercise the Option and the Option shall be cancelled as of the
end of the last business day of the Option term.

ARTICLE VI

DEFERRAL OF ELIGIBLE COMPENSATION AND GAIN SHARES

                    Section 6.01 Elective Deferred Incentive Compensation. The
Deferred Amount of a Participant with respect to each Plan Year of participation
in the Plan shall be credited by the Administrative Committee to the
Participant’s Deferral Account or Sub-Account as and when such Deferred Amount
would otherwise have been paid to the Participant. To the extent that the
Company is required to withhold any taxes or other amounts from the Deferred
Amount pursuant to any state, Federal or local law, such amounts shall be taken
out of compensation to the Participant that is not deferred under this Plan. In
the event a Participant’s deferral election results in insufficient non-deferred
compensation from which to withhold taxes in accordance with applicable law, the
Deferred Amount shall be reduced as necessary to allow the Company to satisfy
tax withholding requirements.

                    Section 6.02 Vesting of Accounts. Except as provided in
Section 8.06, a Participant shall be 100% vested in his/her Account at all
times.

                    Section 6.03 Gain Shares. The gain from the exercise of the
Option which the Participant elects to defer under the Plan as Phantom Share
Units shall be credited by the Administrative Committee to the Participant’s
Gain Share Account as of the Date of Exercise.

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ARTICLE VII

MAINTENANCE AND INVESTMENT OF ACCOUNTS

                    Section 7.01 Maintenance of Accounts. A Deferral Account and
a Gain Share Account, shall be separately maintained for each Participant in
accordance with their Participation Agreements and Stock Option Gain Agreements.
A Participant’s interest in his/her Account, and all Sub-Accounts, shall be
comprised of the deemed investments in the deemed investment funds offered under
the Plan (including the Phantom Share Fund); provided, however, the Gain Share
Account shall only reflect the Participant’s interest in the Phantom Share Fund.
A Participant’s Account or Sub-Account shall be utilized solely as a device for
the measurement and determination of the amounts to be paid to the Participant
pursuant to this Plan, and shall not constitute or be treated as a trust fund of
any kind. Accounts and Sub-Accounts shall be valued daily and balances shall be
available on the Participant web site and in quarterly statements sent to
Participants. For purposes of distributions, the Administrative Committee shall
determine the balance of each Account, and Sub-Account, as of each Valuation
Date.

                    Section 7.02 Investment Choices.

 

 

 

 

(a)

Subject to Section 7.02(d), the Executive Committee shall permit the Participant
to elect to have his/her Deferred Amounts and Deferral Account deemed to be
invested in one or more of the deemed investment funds offered under the Plan,
selecting among the investment choices, as determined by the Executive Committee
from time to time, and in accordance with such rules, regulations and procedures
as the Executive Committee may establish from time to time. A Participant may
elect different hypothetical investment funds for each Sub-Account.
Notwithstanding anything to the contrary herein, earnings and losses based on a
Participant’s investment elections shall begin to accrue as of the date such
Participant’s Deferred Amounts are credited to his/her Deferral Account or
Sub-Account(s); provided, however, that with respect to a Participant who is
participating in the Plan as a “PBJP-like” employee whose incentive award is
determined on other than an annual basis, Deferred Amounts shall not be
considered to be invested until January 1 following the Plan Year to which the
Deferred Amount relates. Upon the Termination of Employment of a Participant who
is participating in the Plan as a “PBC-like” employee, amounts credited to
his/her Deferral Account for which earnings or losses have not begun to accrue
as provided herein at the time of such Termination of Employment shall be paid
Deferred Amount in cash in one lump sum without regard to any earnings or
losses. Notwithstanding anything to the contrary in this Plan, if a Change of
Control occurs within three years of the initial crediting of such Deferred
Amounts to the Deferral Account, the net cumulative earnings with respect to
such Deferred Amounts shall be based on the greater of (i) rate of return based
on the actual investment elections of the Participant and (ii) the rate of
return corresponding to the MaNY Money Market Fund Rate of Return or such other
competitive money market fund rate designated by the Executive Committee, in its
sole discretion.

 

 

 

 

(b)

(i) Phantom Share Units shall be deemed to be invested in shares of Common Stock
and shall comprise the Phantom Share Fund. Deferred Amounts that are deemed to
be invested in the Phantom Share Fund and Gain Shares shall be converted into
Phantom Share Units based upon the Fair Market Value of the Common Stock on the
date(s) the Deferred Amounts or Gain Shares are to be credited to the Deferral
Account or Gain Share Account, as the case may be. Gain Shares shall be
converted into Phantom Stock Units in accordance with Section 5.06. Amounts
allocated to the Gain Share Account shall remain hypothetically invested in the
Phantom Share Fund at all times.

 

 

 

 

 

(ii) The portion of any Deferral Account that is invested in the Phantom Share
Fund and the entire portion of the Gain Share Account shall be credited, as of
each Valuation Date, with additional Phantom Share Units related to cash
dividends paid on the Common Stock with record dates during the period beginning
on the day after the most recent preceding Valuation Date and ending on such
Valuation Date, as follows. The credit shall be for a number of Phantom Share
Units equal to the amount of the aggregate deemed dividend payments on the
Phantom Share Units as of the record date, divided by the Fair Market Value of
one share of Common Stock determined as of the record date, rounded up to the
next whole share.

 

 

 

 

 

(iii) In the event of a stock dividend, split-up or combination of the- Common
Stock, merger, consolidation, reorganization, recapitalization, or other change
in the corporate structure or capitalization affecting the Common Stock, such
that an adjustment is determined by the Executive Committee to be appropriate in
order to prevent dilution or enlargement of the benefits or potential benefits
intended to be made available under this Plan, then the Executive Committee may
make appropriate adjustments to the number of Phantom Share Units credited to
the Deferral Account and Gain Share Account. The determination of the Executive
Committee as to such adjustments, if

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    any, to be made shall be conclusive.      

 

 

(iv) Notwithstanding any other provision of this Plan, the Executive Committee
shall adopt such procedures as it may determine are necessary to ensure that
with respect to any Participant who is actually or potentially subject to
Section 16(b) of the Securities Exchange Act of 1934, as amended, the crediting
of deemed shares to his or her Deferral Account and Gain Share Account is not
deemed to be a non­exempt purchase for purposes of such Section 16(b), including
without limitation requiring that no shares of Common Stock or cash relating to
such deemed shares may be distributed for six months after being credited to
such Deferral Account or Gain Share Account, as the case may be. This Plan will
conform in all relevant respects to the provisions of Sarbanes-Oxley Act of
2002.

 

 

 

 

(c)

The Executive Committee may authorize Options as an investment choice under the
Plan. The terms and conditions under which Options may be made available as an
investment choice shall be determined and communicated by the Executive
Committee to Participants from time to time. Any Options issueable under the
Plan will be made pursuant to the Pitney Bowes Stock Plan, as amended and
restated, January 2002. For purposes of determining the value of Options at the
time of grant, the Executive Committee shall use the method of fair market value
used for other grants under the Pitney Bowes Stock Option Plan as amended and
restated, January 2002. 0ptions shall not be a permitted investment choice with
respect to the deferral of Base Salary under the Plan.

 

 

 

 

(d)

Except with respect to retirees who exercise Options after retirement based on
deferrals made before January 1, 2003, no deemed investment return under the
Plan shall be allocated to Option Sub-Accounts, prior to the last day of the
Deferral Period pertaining to the Option Sub-Account. Upon the expiration of the
Deferral Period, the Participant shall receive a distribution equal to the
original Deferred Amount allocated to the Option, unless he or she has exercised
the right to extend the Distribution Date ­pursuant to Section 4.03(c) of the
Plan, in which case he/she shall be entitled to elect to have his/her Deferred
Amounts related to the granting of such Options deemed to be invested in one or
more of the hypothetical investment funds offered under the Plan effective as
soon as practicable following the end of the original Deferral Period.

                    Section 7.03 Statement of Accounts. The Administrative
Committee shall submit to each Participant quarterly statements of his/her
Account, in such form as the Administrative Committee deems desirable, setting
forth the balance to the credit of such Participant in his/her Deferral Account,
including Sub-Accounts, and Gain Share Account as of the end of the most
recently completed quarter.

ARTICLE VIII

BENEFITS

                    Section 8.01 Time and Form of Payment for In-Service
Distributions and Gain Share Account Distributions.

 

 

 

 

(a)

At the end of the Deferral Period, the Company shall pay to the Participant the
balance of the Fund Sub-Account, Option Sub-Account, or Gain Share Account, as
the case may be, in accordance with the most current valid Form of Payment
election pertaining to that Sub-Account or Gain Share Account on file with the
Administration· Committee or, if none, then as a single lump sum. If the
Deferral Period was extended, then the Company shall pay to the Participant the
balance of the Sub-Account as soon as administratively practicable following the
end of the extended Deferral Period in accordance with the Form of Payment
election made by the Participant or, if none, then in a single lump sum. Amounts
allocated to the Gain Share Account shall only be paid in the form of actual
shares of Common Stock in one lump sum or installments in accordance with the
Participant’s Stock Option Gain Agreement and applicable provisions of the Plan.

 

 

 

 

(b)

The most recent Participation Agreement or Stock Option Gain Agreement, as the
case may be, making Form of Payment elections which is filed with the
Administrative Committee at least twelve (12) months prior to an In-Service
Distribution or Stock Option Gain distribution shall supersede all previous and
subsequent Participation Agreements or Stock Option Gain Agreements, as the case
may be, on file and the entire amount in the Participant’s Sub-Account shall be
distributed in accordance with such Form of Payment elections; provided,
however, that only a subsequent Stock Option Gain Agreement can supersede a
prior Stock Option Gain Agreement and cannot supersede a prior Participation
Agreement, and vice versa.

                    Section 8.02 Time and Form of Payment for Retirement
Distributions.

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(a)

In the event of Retirement, the Company shall distribute an amount equal to the
balance in the Retirement Sub-Account together with remaining unpaid balances in
all In-Service Sub-Accounts which do not correspond to Option Sub-Accounts
(determined as of the applicable Valuation Date) to the Participant as soon as
administratively practicable following the first day of the month following the
date of Retirement in accordance with the most recent Form of Payment election
made by the Participant which was filed at least twelve (12) months prior to the
date of Retirement, or if none, then in five (5) annual installments.

 

 

 

 

(b)

Notwithstanding Section 8.02 (a) hereof, and in accordance with Section 4.04 (c)
hereof, a Participant who meets the definition of Retirement who has been
granted Options pursuant to Section 7.02 (c) hereof in connection with Deferred
Amounts prior to January 1, 2004 shall have that portion of his/her Deferral
Account that relates to the granting of such Options distributed at the earlier
of (i) the Date of Exercise of such Options and (ii) the last day of the Option
term. A Participant who meets the definition of Retirement who has been granted
Options pursuant to Section 7.02 (c) hereof in connection with Deferred Amounts
and who has established Option Sub-Accounts on or after January 1, 2004 shall
have the balance of such Option Sub-Accounts distributed at the end of the
Option term in accordance with distribution provisions in the Plan
notwithstanding an earlier exercise of the Option. Such Deferred Amounts shall
be distributed in accordance with the Form of Payment elected by the Participant
in his/her Participation Agreement or with applicable provisions of the Plan;
provided, however, that if the Deferred Amounts are to be distributed in
installments, the Deferred Amounts related to the granting of Options shall be
entirely distributed over the remaining installment schedule for Retirement
distributions commencing with the next following installment payment due under
the installment schedule. Any lump sum payment shall be paid as soon as
practicable following the Date of Exercise of the Options or the last day of the
Option term, as the case may be.

 

 

 

                    Section 8.03 Time and Form of Payment for Distributions Upon
Termination of Employment. In the event of a Termination of Employment, the
Company shall pay the balance in the Retirement Sub-Account and the remaining
balance in any In-Service Sub­Accounts, valued as of the applicable Valuation
Date, to the Participant in a single lump sum as soon as administratively
practicable following the date of Termination of Employment.

 

 

 

                    Section 8.04 Time and Form of Payment for distributions upon
death or Disability. In the event of death or Disability prior to Retirement or
Termination of Employment, the Company shall pay the entire Deferral Account
balance, including all remaining Sub-Account balances in a single lump sum to
the Participant (in the event of Disability) or to the Beneficiary (in the event
of death). In the event of death or Disability after Retirement, the Company
shall continue to pay benefits in the same amounts and at the same time(s) as if
the Participant had not died or become disabled; except that, in the case of
death, such payments shall be paid to the Beneficiary.

 

 

 

                    Section 8.05 Miscellaneous Distribution Provisions. The
foregoing provisions of this Article VIII notwithstanding:

 

 

 

 

(a)

if a Participant has elected to receive a distribution in the form of a full or
partial lump sum, the Administrative Committee may in its discretion distribute
all or a portion of the Deferred Amounts deemed to be invested in the Phantom
Share Fund in the form of actual shares of Common Stock. Installment payments
from the Deferral Account shall only be paid in cash. All full or partial lump
sum distributions hereunder will be made as soon as practicable following· the
In-Service Distribution Date, end of the Deferral Period, date of Retirement,
date of Termination of Employment, or Death as the case may be, based on the
most recent Valuation Date as of the distribution triggering event.

 

 

 

 

(b)

If the Participant has elected to receive payments in installments, each payment
shall consist of an amount equal to (i) the balance of the Deferral Account, as
of the most recent Valuation Date preceding the payment date times (ii) a
fraction, the numerator of which is one and the denominator of which is the
number of remaining installments (including the installment being paid). The
first such installment shall be paid as soon as practicable after the
distribution triggering event (e.g. In-Service Distribution Date, end of the
Deferral Period, Retirement, etc.) as the case may be, and each subsequent
installment shall be paid on or about the anniversary of such first payment. In
the case of the In-Service and Retirement Sub-Accounts, each such installment
shall be deemed made on a pro rata basis from each of the different deemed
investments of such Sub-Accounts (if there is more than one such deemed
investment).

 

 

 

 

(c)

In the event the balance in the Deferral Account (including all Sub-Accounts) is
less than $50,000 at the time of the initial valuation immediately prior to the
beginning of a Retirement distribution, then the Administrative Committee, in
its sole discretion, may ignore the Form of Payment election made by the
Participant and pay the benefit in a single lump sum.

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                    Section 8.06 Hardship Withdrawals. Notwithstanding the
provisions of Section 8.01 and any Participation Agreement or Stock Option Gain
Agreement, as the case may be, a Participant shall be entitled to request early
payment of all or part of the balance in his/her Deferral Account and Gain Share
Account in the event of an Unforeseeable Emergency, in accordance with this
Section 8.06. A distribution pursuant to this Section 8.06 may only be made to
the extent reasonably needed to satisfy the Unforeseeable Emergency need, and
may not be made if such need is or may be relieved (i) through reimbursement or
compensation by insurance or otherwise, (ii) by liquidation of the Participant’s
assets to the extent such liquidation would not itself cause severe financial
hardship, or (iii) by cessation of participation in the Plan. An application for
an early payment under this Section 8.06 shall be made to the Administrative
Committee in such form and in accordance with such procedures as the
Administrative Committee shall determine from time to time. The determination of
whether and in what amount and form a distribution will be permitted pursuant to
this Section 8.06 shall be made by the Administrative Committee. Distributions
shall be made from In-Service and Option Sub­Accounts and Gain Share Accounts
(beginning with the most distant) and then from the Retirement Sub-Account.

                    Section 8.07 Voluntary Early Withdrawal. Notwithstanding the
provisions of Section 8.01 and any Participation Agreement or Stock Option Gain
Agreement, a Participant shall be entitled to elect to withdraw all of the
balances in his/her Deferral Account and Gain Share Account in accordance with
this Section 8.07 by filing with the Administrative Committee such forms, in
accordance with such procedures, as the. Administrative Committee shall
determine from time to time. As soon as practicable after receipt of such form
by the Administrative Committee, the Company shall pay an amount equal to ninety
percent of the balance in such Participant’s Deferral Account(s) and ninety
percent of any Gain Shares allocated to the Gain Share Account (determined as of
the most recent Valuation Date preceding the date such election is filed) to the
electing Participant in a lump sum in cash, or actual shares of Common Stock in
the case of the Gain Share Account, and the Participant shall forfeit the
remainder of such Deferral Account or Gain Share Account, as the case may be.
The most recent Participation Agreement or the Stock Option Gain Agreement
previously filed by a Participant who elects to make a withdrawal under this
Section 8.07 shall be null and void as a result of a voluntary early withdrawal
hereunder (including without limitation a Participation Agreement or the Stock
Option Gain Agreement, as the case may be, with respect to Plan Years or
performance periods that have not yet been completed). A Participant who does
not have a Participation Agreement or Stock Option Gain Agreement on file at the
time of the voluntary early withdrawal request shall not be permitted to file an
additional Participation Agreement or Stock Option Gain Agreement for one year
following the last day of the deferral election period immediately following the
voluntary early withdrawal request. Distributions shall be made from In-Service
or Option Sub-Accounts and Gain Share Accounts (beginning with the most distant)
and then from the Retirement Sub-Account.

                    Section 8.08 Payments in Connection with Change of Control.
Notwithstanding anything contained in this Plan to the contrary, upon a Change
of Control, the Company shall immediately pay to each Participant in a lump sum
in cash the balance in his/her Deferral Account or in actual shares of Common
Stock in the case of the Gain Share Account (determined as of the most recent
Valuation Date preceding the Change of Control).

                    Section 8.09 Withholding of Taxes. Notwithstanding any other
provision of this Plan, the Company shall withhold from payments made hereunder
any amounts required to be so withheld by any applicable law or regulation.

                    Section 8.10 Modification of Payment Schedule.
Notwithstanding anything herein to the contrary, the Committee may in its sole
and exclusive discretion modify the method and timing of payment of Deferred
Amounts as previously elected by the Participant based on circumstances it has
identified as being in the best interests of the Company.

ARTICLE IX

BENEFICIARY DESIGNATION

                    Section 9.01 Beneficiary Designation. Each Participant shall
have the right, at any time, to designate any person, persons or entity as his
Beneficiary or Beneficiaries to receive the balance of his or her Account upon
the Participant’s death. A Beneficiary designation shall be made, and may be
amended, by the Participant by filing a written designation with the
Administrative Committee, on such form and in accordance with such procedures as
the Administrative Committee shall establish from time to time.

                    Section 9.02 No Beneficiary Designation. If a Participant
fails to designate a Beneficiary as provided above, or if all designated
Beneficiaries predecease the Participant, then the Participant’s Beneficiary
shall be deemed to be the Participant’s estate.

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ARTICLE X

AMENDMENT AND TERMINATION OF PLAN

                    Section 10.01 Amendment. The Board or the Executive
Committee may at any time amend this Plan in whole or in part, provided,
however, that no amendment shall be effective to decrease the balance in any
Account as accrued at the time of such amendment, nor shall any amendment
otherwise have a retroactive effect except if such retroactivity does not cause
a materially adverse financial effect.

                    Section 10.02 Company’s Right to Terminate. The Board or the
Executive Committee may at any time terminate the Plan with respect to future
Participation Agreements and Stock Option Gain Agreements. The Board or the
Executive Committee may also terminate the Plan in its entirety or in part at
any time for any reason, including without limitation if, in its judgment, the
continuance of the Plan, the tax, accounting, or other effects thereof, or
potential payments thereunder would not be in the best interests of the Company,
and upon any such termination, the Company shall immediately pay to each
Participant in a lump sum the accrued balance in his Account (determined as of
the most recent Valuation Date preceding the termination date).

ARTICLE XI

MISCELLANEOUS

                    Section 11.01 Unfunded Plan. This Plan is intended to be an
unfunded plan maintained primarily for the purpose of providing deferred
compensation for a select group of management or highly compensated employees,
within the meaning of Section 401 of ERISA. All payments pursuant to the Plan
shall be made from the general funds of the Company and no special or separate
fund shall be established or other segregation of assets made to assure payment.
No Participant or other person shall have under any circumstances any interest
in any particular property or assets of the Company as a result of participating
in the Plan. Notwithstanding the foregoing, the Company may (but shall not be
obligated to) create one or more grantor trusts, the assets of which are subject
to the claims of the Company’s creditors, to assist it in accumulating funds to
pay its obligations under the Plan.

                    Section 11.02 Nonassignability. Except as specifically set
forth in the Plan with respect to the designation of Beneficiaries, neither a
Participant nor any other person shall have any right to commute, sell, assign,
transfer, pledge, anticipate, mortgage or otherwise encumber, transfer,
hypothecate or convey in advance of actual receipt the amounts, if any, payable
hereunder, or any part thereof, which are, and all rights to which are,
expressly declared to be unassignable and non-transferable. No part of the
amounts payable shall, prior to actual payment, be subject to seizure or
sequestration for the payment of any debts, judgments, alimony or separate
maintenance owed by a Participant or any other person, nor be transferable by
operation of law in the event of a Participant’s or any other person’s
bankruptcy or insolvency.

                    Section 11.03 Validity and Severability. The invalidity or
unenforceability of any provision of this Plan shall not affect the validity or
enforceability of any other provision of this Plan, which shall remain in full
force and effect, and any prohibition or unenforceability in any jurisdiction
shall not invalidate or render unenforceable such provision in any other
jurisdiction.

                    Section 11.04 Governing Law. The validity, interpretation,
construction and performance of this Plan shall in all respects be governed by
the laws of the State of Connecticut, without reference to principles of
conflict of law, except to the extent pre-empted by federal law.

                    Section 11.05 Employment Status. This Plan does not
constitute a contract of employment or impose on the Participant or the Company
any obligation for the Participant to remain an employee of the Company or
change the status of the Participant’s employment or the policies of the Company
and its affiliates regarding termination of employment.

                    Section 11.06 Underlying Incentive Plans and Programs.
Nothing in this Plan shall prevent the Company from modifying, amending or
terminating the compensation or the incentive plans and programs, including the
Pitney Bowes Inc. Key Employees’ Incentive Plan pursuant to which cash awards
are earned and which are deferred under this Plan and the Pitney Bowes Stock
Option Plan as amended and restated, January, 2002

                    Section 11.07 Severance. Notwithstanding anything to the
contrary herein the Executive Committee may, in its sole and exclusive
discretion, determine that the Accounts of a Participant who has incurred a
Termination of Employment and who receives or will receive severance payments
from the Company shall be paid in installments, at such intervals as the
Executive Committee may decide.

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                    Section 11.08 Termination of Employment. Upon Termination of
Employment, Disability or death, a Participant shall forfeit all rights and
entitlements to actively participate in the Plan, including the opportunity to
make further deferral elections of Eligible Compensation, gain on related Gain
Shares, direction of deemed investment funds and any other activities offered to
active Participants, unless the Administrative Committee in its sole discretion
decides otherwise.

138

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