EXHIBIT (iii)
FIRST AMENDMENT TO
PITNEY BOWES INC.
KEY EMPLOYEES' INCENTIVE PLAN
(As Amended and Restated: June 10, 1991)
The Pitney Bowes Inc. Key Employees' Incentive Plan, as
amended and restated June 10, 1991 (the "Plan"), is hereby
amended, effective as of the date set forth below, as
follows:
1. This Amendment shall be effective if and only if it
is approved by the stockholders of Pitney Bowes Inc. (the
"Company") at their annual meeting in 1996, and if so
approved, this Amendment shall be effective as of January
1, 1996.
2. Section 6(E) of the Plan is amended to read in its
entirety as follows:
(E) For purposes of this Plan, a "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 the
Company, 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 13d-3 promulgated under the Exchange
Act) of 20 percent or more of either the then
outstanding shares of common stock of the Company or the
combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in
the election of directors, but excluding, for this
purpose, any such acquisition by the Company or any of
its subsidiaries, or any employee benefit plan (or re
lated trust) of the Company or its subsidiaries, or any
corporation with respect to which, following such
acquisition, more than 50 percent 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 benefi
cially owned, directly or indirectly, by the individuals
and entities who were the beneficial owners,
respectively, of the common stock and voting securities
of the Company 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 of the Company or the
combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in
the election of directors, as the case may be; or
(ii) Individuals who, as of September 12, 1988, con
stitute the Board of Directors (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 September 12,
1988, whose election, or nomination for election by the
Company's 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 the Company (as such terms
are used in Rule 14a-11 or Regulation 14A promulgated
under the Exchange Act); or
(iii) There is (x) an approval by the shareholders of
the Company of a reorganization, merger or con
solidation, in each case, with respect to which the indi
viduals and entities who were the respective beneficial
owners of the common stock and voting securities of the
Company immediately prior to such reorganization, merger
or consolidation do not, following such reorganization,
merger or consolidation, beneficially own, directly or
indirectly, more than 50 percent 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 (y) an
approval by the shareholders of the Company of a
complete liquidation or dissolution of the Company or of
the sale or other disposition of all or substantially
all of the assets of the Company.
3. There is added to the Plan a new Section 10, reading
in its entirety as follows:
10. (A) The provisions of this Section 10 shall
be applicable to awards under the Plan to "Covered
Employees" if the Committee so provides at the time
of grant (such awards being referred to as "Covered
Awards"). For purposes of this Section 10, "Covered
Employees" means participants in the Plan who are
designated by the Committee prior to the grant of an
award hereunder who are, or are expected to be at the
time taxable income will be realized with respect to
the award, "covered employees" within the meaning of
Section 162(m) of the Internal Revenue Code of 1986,
as amended, or any successor thereto, and the
Treasury Regulations thereunder ("Section 162(m)").
(B) Covered Awards shall be made subject to
the achievement of one or more preestablished Perfor
mance Goals (as defined below), in accordance with
procedures to be established by the Committee from
time to time. Notwithstanding any provision of the
Plan to the contrary, the Committee shall not have
discretion to waive or amend such Performance Goals
or to increase the amount payable pursuant to Covered
Awards after the Performance Goals have been
established; provided, however, that the Committee
may, in its sole dis
cretion, reduce the amount which
would otherwise be payable with respect to any
Covered Award; and provided, further, that the
provisions of Section 8 shall override any contrary
provision of this Section 10.
(C) "Performance Goals" means one or more
objective performance goals, established by the
Committee at the time an award is granted, and based
upon the attainment of targets for one or any
combination of the following criteria: operating in
come, revenues, return on operating assets, earnings
per share, return on stockholder equity, stock price,
or achievement of cost control, of the Company or
such subsidiary, division or department of the
Company for or within which the participant is pri
marily employed. Performance Goals also may be based
upon attaining specified levels of Company per
formance based upon one or more of the criteria
described above relative to prior periods or the
performance of other corporations. Performance Goals
shall be set by the Committee within the time period
prescribed by Section 162(m).
(D) No payment shall be made pursuant to a
Covered Award unless and until the Committee shall
have certified in writing that the applicable Per
formance Goals have been attained. The maximum
amount payable pursuant to Covered Awards to a
particular Covered Employee for any fiscal year of
the Company shall be $5,000,000.
(E) The Committee may from time to time
establish procedures pursuant to which Covered
Employees will be permitted or required to defer
receipt of awards under the Plan.
(F) Notwithstanding any other provision of
the Plan, for all purposes involving Covered Awards,
the Committee shall consist of at least two members
of the Board of Directors, each of whom is an
"outside director" within the meaning of Section
162(m).
4. Except as provided above, the Plan shall continue in
effect without amendment.