AMENDED AND RESTATED
FINANCE AGREEMENT
This AMENDED AND RESTATED FINANCE AGREEMENT is dated as of the 12th day of
June, 1995, and amends and restates in its entirety the Finance Agreement dated
as of July 5, 1978 between Pitney Bowes Inc. ("Pitney Bowes") and Pitney Bowes
Credit Corporation ("PBCC") (formerly, PB Leasing Corporation).
Pitney Bowes, as the owner and holder of all of the issued and outstanding
shares of voting stock of PBCC, desires to provide certain agreements as to the
fixed charge coverage of, and availability of funds to, PBCC in connection with
the incurrence, assumption or guaranty by PBCC from time to time of Approved
Debt (as hereinafter defined) and commercial paper.
In order to accomplish the foregoing, the parties hereto agree as follows:
1. Fixed Charge Coverage. As long as this Agreement is in effect, Pitney
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Bowes will, within 45 days after the last day of each fiscal quarter of PBCC,
make, or cause to be made, a determination of ratio of Income Available for
Fixed Charges for the immediately preceding one-year period. If, at any time
such determination is made, said ratio of Income Available for Fixed Charges to
Fixed Charges shall be less than 1.25 to 1, Pitney Bowes will, within 10 days
after the date of such determination, pay to PBCC a fee in an amount at least
sufficient to increase said ratio of Income Available for Fixed Charges to
Fixed Charges to 1.25 to 1.
2. Maintenance of Liquidity. At all times while this Agreement is in
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effect, if PBCC is unable to make timely payment of any principal, interest or
premium in respect of any Approved Debt or commercial paper, Pitney Bowes shall,
at PBCC's request, provide (or cause to be provided) to PBCC on a timely basis,
funds (which, if provided by Pitney Bowes or any subsidiary of Pitney Bowes, may
be provided as an equity contribution, as a loan or otherwise, in each case, as
elected by Pitney Bowes) sufficient to make such payment.
3. Stock Ownership. At all times during the term of this Agreement, Pitney
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Bowes shall own and hold, directly or indirectly, the legal title to and
beneficial interest in a majority of the outstanding shares of stock of PBCC
having the right to vote for the election of members of the Board of Directors
of PBCC, and shall not pledge, directly or indirectly, or in any way encumber or
otherwise dispose of any such shares of stock of PBCC or permit its subsidiaries
to do so.
4. Definitions. As used in this Agreement, the following terms have the
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meanings indicated:
"Approved Debt" shall mean indebtedness for borrowed money incurred,
assumed or guaranteed by PBCC pursuant to (i) The Indenture, dated May 1, 1985,
as supplemented (the "Indenture"), between PBCC and Bankers Trust Company, as
Trustee, and (ii) other agreements (including future indentures for borrowed
money) which by their express terms make such indebtedness entitled to the
provisions of this Agreement.
"Fixed Charges" of PBCC and its subsidiaries shall mean, at the time of any
determination thereof, the sum of (i) the aggregate amount of fixed rentals
payable during the immediately preceding one-year period by PBCC and its
subsidiaries with respect to all leases of real and personal property (other
than leases between PBCC and any subsidiary or between subsidiaries) and (ii)
the interest charges on the aggregate principal amount of consolidated
indebtedness of PBCC and its subsidiaries during such period.
"Income Available for Fixed Charges" shall mean, at the time of any
determination thereof, the consolidated net income of PBCC and its subsidiaries
determined in accordance with generally accepted accounting principles, except
that such determination shall be made before any deduction for Fixed Charges or
provisions for taxes in respect of income.
5. Amendment and Termination. This Agreement, or any term, covenant,
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agreement or condition hereof, may be amended or terminated by the parties
hereto at any time in writing; provided that, so long as any series of Approved
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Debt therefore issued remains outstanding, no such amendment or termination
which has a material adverse affect on the rights of the holders of such series
of Approved Debt shall become effective with respect to such series of Approved
Debt unless (i) at least two nationally recognized statistical rating agencies
that have rated such series of Approved Debt prior to such amendment or
termination confirm in writing that their ratings for such series of Approved
Debt in effect immediately prior to such amendment or termination will not be
downgraded as a result of such amendment or termination, or (ii) the holders of
the majority in principal amount of such series of Approved Debt shall have
consented thereto in writing.
6. Rights of Holders of Debt. All holders of Approved Debt and commercial
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paper issued during the term of this Agreement shall be intended third-party
beneficiaries of this Agreement; provided that the third-party beneficiary
rights of any such holder shall be limited to (i) the right to demand that PBCC
enforce PBCC's rights under paragraphs 1 and 2 of this Agreement, and (ii) the
right to proceed against Pitney Bowes on behalf of PBCC to enforce PBCC's rights
under paragraphs 1 and 2 of this Agreement if PBCC fails or refuses to take
timely action to enforce PBCC's rights hereunder following demand for such
enforcement by any such holder. Notwithstanding the foregoing, holders of
Approved Debt issued pursuant to the terms of the Indenture shall only be
entitled to exercise such rights in accordance with the terms of the Indenture.
7. Not a Guaranty. Notwithstanding any other provision of this Agreement,
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this Agreement, its provisions and any actions taken pursuant hereto by Pitney
Bowes shall not constitute or be deemed to constitute a direct or indirect
guaranty by Pitney Bowes or any Approved Debt or any other obligation or
liability of any kind or character whatsoever of PBCC, and no holder of any such
Approved Debt, obligation or liability shall have any right to proceed directly
against Pitney Bowes to obtain any amount due with respect to any such Approved
Debt,
obligation or liability, including, without limitation, any principal thereof or
interest or premium thereon.
8. Successors or Assigns. This Agreement shall be binding upon and inure
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to the benefit of the parties hereto and their respective successors and
assigns.
9. Notices. Pitney Bowes and PBCC shall provide any nationally recognized
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statistical rating agency that has rated Approved Debt and commercial paper,
notice of the intention to amend or terminate this agreement which will be no
less than the greater of (i) 60 days or (ii) the number of days to maturity of
PBCC's latest maturing commercial paper.
10. Applicable Law. This Agreement shall be governed by and construed in
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accordance with the laws of the State of New York.
PITNEY BOWES CREDIT CORPORATION PITNEY BOWES INC.
By: /s/ Matthew Hess By: /s/ George B. Harvey
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Title: President and CEO Title: Chairman, President & CEO