PITNEY BOWES INC /DE/, DEF 14A, 1994-03-24

PITNEY BOWES INC /DE/
DEF 14A, 1994-03-24
OFFICE MACHINES, NEC

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )

Filed by the Registrant /X/
Filed by a Party other than the Registrant /_/

Check the appropriate box:

/_/ Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12

Pitney Bowes Inc.
________________________________________________________________________________
(Name of Registrant as Specified In Its Charter)

Pitney Bowes Inc.
________________________________________________________________________________
(Name of Person(s) Filing Proxy Statement)

Payment of Filing Fee (Check the appropriate box):

/X/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1) or 14a-6(j)(2).
/_/ $500 per each party to the controversy pursuant to
Exchange Act Rule 14a-6(i)(3).
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

1) Title of each class of securities to which transaction applies:

_____________________________________________________________________________

2) Aggregate number of securities to which transaction applies:

_____________________________________________________________________________

3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:*

_____________________________________________________________________________

4) Proposed maximum aggregate value of transaction:

_____________________________________________________________________________

/_/ Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the form or schedule
and the date of its filing.

1) Amount previously paid: _________________________________________________

2) Form, Schedule or Registration No. ______________________________________

3) Filing party: ___________________________________________________________

4) Date filed: _____________________________________________________________

___________
*Set forth the amount on which the filing fee is calculated and state how it was
determined.

<PAGE>

---------------------------------------------------------------
---------------------------------------------------------------
Pitney Bowes
---------------------------------------------------------------
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To the Stockholders:
---------------------------------------------------------------

Stockholders attending the annual meeting at our World
Headquarters in Stamford on May 9, 1994, are cordially
invited to join us for a continental breakfast served from 8
a.m. until the meeting begins at 10 a.m.

We look forward to welcoming many stockholders to the
meeting and will make it as interesting and informative as
possible.

Sincerely yours,

George B. Harvey
Chairman and President

Stamford, Connecticut
March 25, 1994

<PAGE>

---------------------------------------------------------------
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---------------------------------------------------------------
---------------------------------------------------------------
Notice of Meeting:
---------------------------------------------------------------

The annual meeting of stockholders of Pitney Bowes Inc. will
be held on May 9, 1994, at 10 a.m., at the company's World
Headquarters, One Elmcroft Road, Stamford, Connecticut.
Directions to the Pitney Bowes World Headquarters are set
forth on the back cover page of the Proxy Statement; a map
is on the inside back cover.

The items of business at the annual meeting are:

1. Election of four directors.

2. Appointment of independent accountants for 1994.

3. Such other matters as may properly come before the
meeting or any adjournments or postponements
thereof.

All holders of record of Pitney Bowes common stock and $2.12
convertible preference stock as of the close of business on
March 11, 1994, are entitled to vote at the meeting or any
adjournments or postponements thereof.

It is important that all stockholders be represented at the
meeting. Stockholders are urged to sign and return promptly
the enclosed proxy in the accompanying envelope, which
requires no postage if mailed in the United States.

Douglas A. Riggs
Vice President, Communications, Planning,
Secretary and General Counsel

<PAGE>

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Pitney Bowes
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

Proxy Statement

This statement is furnished in connection with the solicitation of proxies by
the board of directors of Pitney Bowes Inc. (the "board") for use at the annual
meeting of stockholders to be held on May 9, 1994, and at any adjournment or
postponement thereof. Proxies may be revoked at any time before they are voted
by submission to the Secretary of the company of a written revocation or, in the
case of a registered stockholder, a later-dated proxy, or by the stockholder's
attendance, revocation and vote at the annual meeting. Each proxy not revoked
will be voted at the meeting and will be voted in accordance with the
instructions given in the proxy. The votes of the holders of Pitney Bowes common
stock and $2.12 convertible preference stock ("$2.12 preference stock") will be
aggregated for each agenda item. Each share of common stock will be entitled to
one vote and each share of preference stock will be entitled to eight votes for
each agenda item.

Votes cast by proxy or in person at the annual meeting will be tabulated by the
election inspectors appointed for the meeting and will determine whether or not
a quorum is present. The election inspectors will treat abstentions as shares
that are present and entitled to vote for purposes of determining the presence
of a quorum but as unvoted for purposes of determining the approval of any
matter submitted to the stockholders for a vote. If a broker indicates on the
proxy that it does not have discretionary authority as to certain shares to vote
on a particular matter, those shares will not be considered as present and
entitled to vote with respect to that matter.

At the close of business on March 11, 1994, the record date for the meeting,
there were (net of treasury shares) 158,164,139 shares of common stock
outstanding and 107,977 shares of $2.12 preference stock outstanding.

The company's headquarters are in Stamford, Connecticut 06926-0700. This proxy
statement and the enclosed proxy are being mailed to stockholders on or about
March 25, 1994.

Election of Directors

Under the company's Restated Certificate of Incorporation, there are three
classes of directors numbering as nearly equal in size as possible. Each class
is elected for a three-year term.

Three directors, Mr. Emery, Mr. Harvey and Mrs. Sewell were elected last year to
three-year terms expiring in 1996. Ms. Alvarado, Mr. Campbell, and Mr. Hugel
were elected in 1992 to three-year terms expiring in 1995.

Mr. Butler, Mr. Kimball, Mr. Nunery and Mr. Taylor were elected in 1991 to
three-year terms expiring in 1994. The Nominating and Organization Affairs
Committee, consisting of four nonemployee directors whose names are set out on
page 6, recommended and the board approved proposing to stockholders the
reelection of Mr. Butler, Mr. Kimball, Mr. Nunery and Mr. Taylor to three-year
terms expiring in 1997.

Should you choose not to vote for a nominee, you may list on the proxy the name
of the nominee for whom you choose not to vote and mark your proxy under
Proposal No. 1 for all other nominees. Should any nominee become unable to
accept nomination or election as a director (which is not now anticipated), the
persons named in the enclosed proxy will vote for such substitute nominee as may
be selected by the board, unless the board reduces the number of members of the
board below ten directors, which is not currently contemplated. The affirmative
vote of a plurality of the aggregate of issued and outstanding shares of Pitney
Bowes common and preference stock (each share of preference stock counting as
eight votes of common stock) voted in person or by proxy at the annual meeting
is required to elect directors.

Information about each nominee for director and each incumbent director,
including the nominee's or incumbent's age as of February 28, 1994, is set forth
below. Unless otherwise indicated, each nominee or incumbent has held his or her
present position for at least five years.

<PAGE>

NOMINEES FOR ELECTION
TO TERMS EXPIRING AT THE 1997 ANNUAL MEETING

[Photograph] William E. Butler, 62, chairman and chief executive
officer since 1991, and director of Eaton Corporation,
manufacturer of engineered products serving the
automotive, industrial, commercial and defense markets.
President and chief operating officer of Eaton
Corporation from 1989 to 1991. President-Automotive
Components Group of Eaton Corporation from 1979 to 1989.
Director since 1991. (Also a director of Bearings, Inc.,
Zurn Industries and Ferro Corporation.)

[Photgraph] David T. Kimball, 66, retired chairman and chief
executive officer of General Signal Corporation,
manufacturer of instrumentation and control systems and
industrial equipment. Director since 1983.

[Photgraph] Leroy D. Nunery, 38, vice president, human and
information resources of the National Basketball
Association since 1993. Formerly director and sector
head of the Public Finance Sector, Merchant Banking
Group, 1991-1993, and vice president, Corporate Banking
Group, 1987-1991, of Swiss Bank Corporation. Vice
President - Financial Products Group of First National
Bank of Chicago from 1986 to 1987. National board member
since 1983 and former national president of the National
Black MBA Association, Inc. from 1986 to 1989. Director
since 1991.

[Photgraph] Arthur R. Taylor, 58, chairman of Arthur Taylor &
Company, an investment firm, and since 1992, president
of Muhlenberg College in Allentown, Pennsylvania. Dean
of the faculty of Business, Fordham University from 1985
to 1992. Director since 1982. (Also a director of
Louisiana Land and Exploration Company, Nomura Pacific
Basin Fund, Inc., Japan OTC Fund, Inc., Korea Equity
Fund, Inc., and Jakarta Growth Fund Inc.)

INCUMBENT DIRECTORS WHOSE
TERMS EXPIRE AT THE 1996 ANNUAL MEETING

[Photgraph] John C. Emery, Jr., 69, vice chairman of The Robbins
Company, since 1991, and former chairman, president and
chief executive officer of Emery Air Freight
Corporation. Director since 1974. (Also a director of
General Housewares Corp.)

[Photgraph] George B. Harvey, 62, chairman, president and chief
executive officer of Pitney Bowes Inc. Director since
1980. (Also a director of Connecticut Mutual Life
Insurance Co., Merrill Lynch & Co., Inc. and McGraw
Hill, Inc.)

<PAGE>

[Photgraph] Phyllis Shapiro Sewell, 63, retired senior vice
president of Federated Department Stores, Inc. Director
since 1987. (Also a director of Lee Enterprises, Inc.,
United States Shoe Corporation and Sysco Corporation.)*

* Ms. Sewell retired as a senior vice president of Federated Department Stores,
Inc., in July 1988. Federated filed for protection under Chapter 11 of the
U.S. Bankruptcy laws on January 15, 1990, and emerged from Chapter 11 on
February 5, 1992.

INCUMBENT DIRECTORS WHOSE
TERMS EXPIRE AT THE 1995 ANNUAL MEETING

[Photgraph] Linda G. Alvarado, 42, president, since 1974, of
Alvarado Construction, Inc., a Denver-based commercial
and industrial general contractor. Director since 1992.
(Also a director of Cyprus Amax Minerals Company, Lennox
International, Inc., Norwest Banks of Colorado, Inc.,
and Pena Investment Advisors.)

[Photgraph] Colin G. Campbell, 58, president of Rockefeller Brothers
Fund, a philanthropic organization. Former president of
Wesleyan University from 1970 to 1988. Director since
1977. (Also director of Hartford Steam Boiler Inspection
& Insurance Company, and Sysco Corporation.)

[Photgraph] Charles E. Hugel, 65, retired chairman and chief
executive officer of Combustion Engineering, Inc., a
company whose principal products are power generation,
and process equipment and systems. Director since 1987.
(Also a director of Eaton Corporation.)

4
<PAGE>

The board met eight times in 1993 and all directors attended at least 75 percent
of the aggregate of the total number of board meetings and the total number of
meetings held by the board committees on which he or she served during 1993. For
1993, the rate of attendance at such meetings was 96.6 percent.

Committees of the Board of Directors

Members of the board serve on one or more of the following seven committees.

The Audit Committee, which met three times in 1993 and is composed entirely of
independent directors, monitors the financial reporting standards and practices
of the company and the company's internal financial controls to ensure
compliance with the policies and objectives established by the board of
directors. To further the foregoing, the Audit Committee recommends to the board
for stockholder approval an independent accounting firm to conduct the annual
audit, and discusses with the company's independent accountants the scope of
their examinations with particular attention to areas where either the committee
or the independent accountants believe special emphasis should be directed. The
committee reviews the annual financial statements and independent accountants'
report, invites the accountants' recommendations on internal controls and on
other matters, and reviews the evaluation given and corrective action taken by
management. It reviews the independence of the accountants and their fees. It
also reviews Pitney Bowes' internal accounting controls and the scope and
results of the company's internal auditing activities and submits reports and
proposals to the board. Members are Charles E. Hugel, Chairman, Linda G.
Alvarado, Colin G. Campbell, and Arthur R. Taylor.

The Corporate Responsibility Committee, which met three times in 1993, monitors
the company's policies and programs concerning stockholders, customers,
employees, and the communities in which the company operates. The policies and
programs that the committee monitors include employee relations, investor
relations, environmental protection, customer satisfaction, postal and
governmental relations, employee safety and product safety. Members are William
E. Butler, Chairman, Linda G. Alvarado, and Phyllis Shapiro Sewell.

The Executive Committee, which did not meet in 1993, can act, to the extent
permitted by Delaware corporation law and the company's restated certificate of
incorporation and bylaws, on all matters concerning management of the business
which may arise between scheduled board of directors meetings. Its actions are
subject to approval or revision by the board. Members are George B. Harvey,
Chairman, Colin G. Campbell, John C. Emery, Jr., and Arthur R. Taylor.

The Executive Compensation Committee, which met six times in 1993, is composed
entirely of independent directors and oversees the company's executive
compensation program, including establishing the company's executive
compensation policies and undertaking an annual review of all components of
compensation to ensure that they appropriately achieve the company's objectives.
The committee is also responsible for certain administrative aspects of the
company's compensation plans (see "Executive Officer Compensation" beginning on
page 9) and the 1984 Pitney Bowes Employee Stock Purchase Plan, and recommends
changes in such plans. It also establishes performance targets and grants, or
recommends for grant, incentives in the forms permitted under the Pitney Bowes
Key Employees' Incentive Plan, and recommends grants of incentives under the
Pitney Bowes 1991 Stock Plan. Grants recommended by the Executive Compensation
Committee are approved by the independent directors of the board. Members are
Phyllis Shapiro Sewell, Chairman, William E. Butler, and David T. Kimball.

The Finance Committee, which met six times in 1993, reviews the company's
financial condition and evaluates significant financial policies and investment
decisions, advises management and recommends financial action to the board. The
committee's duties include monitoring the company's current and projected
financial condition and reviewing and approving major investment decisions.
Members are Arthur R. Taylor, Chairman, Colin G. Campbell, John C. Emery, Jr.,
and Leroy D. Nunery.

The Nominating and Organization Affairs Committee, which met five times in 1993,
recommends directors for nomination by the board for election by stockholders,
recommends membership and duties of the board committees, reviews officers'

5
<PAGE>

potential for growth, and with the chief executive officer, is responsible for
succession planning and ensuring management continuity. The committee reviews
and evaluates the effectiveness of corporate administration and its governing
documents. The committee will consider nominees for director recommended by the
company's stockholders. Stockholder recommendations must be in writing addressed
to the Chairman of the Nominating and Organization Affairs Committee, c/o
Secretary of the company at the address set forth on the cover of this proxy
statement, and should include a statement describing the qualifications and
experience of the proposed candidate and the basis for nomination. Members are
Colin G. Campbell, Chairman, John C. Emery, Jr., Charles E. Hugel, and Phyllis
Shapiro Sewell.

The Retirement Advisory Committee, which met three times in 1993, oversees the
financial operations of the company's retirement, savings, and post-retirement
benefit plans and retirement funds to ensure that plan liabilities are
adequately funded and plan assets prudently managed. The committee recommends
for approval by the board the establishment of new plans and any amendments that
materially affect cost, benefit coverages, or liabilities of the plans. With
respect to major retirement plans, the committee appoints and removes plan
trustees and investment managers, sets the managers' investment return
objectives, and approves contributions to such plans. It reports to the board on
the operations of all plans and the management of funds established thereunder.
Members are David T. Kimball, Chairman, Linda G. Alvarado, and Leroy D. Nunery.

Security Ownership of Directors And Executive Officers

The following table sets forth, as of March 11, 1994, the number of shares of
common stock (rounded to the nearest whole number) held by each director, each
nominee for director, each of the five executive officers named in the Summary
Compensation Table (Table I) on page 10, and all directors and executive
officers as a group (19 persons). The directors and executive officers as a
group are beneficial owners of less than one percent of the aggregate shares of
common stock and $2.12 preference stock. The company is not aware of any person
or group of persons who are beneficial owners of more than five percent of any
class of the company's voting securities.

Executive officers and directors are required by the Securities Exchange Act of
1934, as amended, to file forms with the Securities and Exchange Commision to
report their holdings in the company's securities and to furnish the company
with copies of such forms. It is the practice of the company to file such forms
on behalf of its directors and executive officers. On September 13, 1993, the
board of directors elected Johnna G. Torsone to the corporate officer position
of Vice President-Personnel. The company did not file within ten days of that
action a Form 3 with the U. S. Securities and Exchange Commission setting forth
the initial statement of her ownership of company securities. The form was filed
and all subsequent forms have been timely filed.

6
<PAGE>

SECURITY OWNERSHIP
<TABLE>
<CAPTION>

Shares Options
Deemed to Exercisable
Title of be Beneficially Within
Class of Stock Name of Beneficial Owner Owned(a)(b) 60 Days(c)
------------- ---------------------------------------- ------------- -----------
<S> <C> <C> <C>
Common Linda G. Alvarado 1,809 --
Common William E. Butler 2,200 --
Common Colin G. Campbell 5,200 --
Common John C. Emery, Jr. 9,684 --
Common George B. Harvey 313,580 228,001
Common Charles E. Hugel 2,200 --
Common David T. Kimball 21,200 --
Common Leroy D. Nunery 1,238 --
Common Phyllis Shapiro Sewell 2,200 --
Common Arthur R. Taylor 8,023 --
Common Carmine F. Adimando 38,856 41,025
Common Marc C. Breslawsky 60,961 88,175
Common Hiro R. Hiranandani 55,600 62,575
Common Carole F. St. Mark 32,168 49,825
------- ----------------------------------- ------- -------
Common All executive officers and directors
as a group (19) 623,415 469,601

<FN>
- --------------
(a) Some of the holdings shown include shares required to be reported as
beneficially owned by the directors or executive officers even though
beneficial ownership of those shares has be disclaimed. The number of
common shares so reported are 28,000 in the case of Mr. Harvey, 4,000
in the case of Mr. Campbell, and 32,732.62 in the case of all
executive officers and directors as a group.

(b) The shares beneficially owned by any director or executive officer,
or by all directors and executive officers as a group, represent in
each case less than one percent of the class.

(c) The executive officer has the right to acquire beneficial ownership
of this number of shares within 60 days by exercising outstanding
stock options which would require the payment of substantial amounts
to cover the exercise price of such options. See footnote (2) to
Table III on page 12. These shares may also be deemed to be
beneficially owned by the executive officer.
</FN>
</TABLE>

DIRECTORS' COMPENSATION

Director's Fees. In 1993, each director (other than Mr. Harvey) received a fee
of $24,000 per year. In addition, each director (other than Mr. Harvey) received
$1,100 for each board and committee meeting attended. Directors were also
reimbursed for their out-of-pocket expenses incurred in attending board and
committee meetings. Directors may elect to defer receipt of fees, in which event
they receive interest on the amount deferred at the rate then payable on
Standard & Poors AA-rated bonds.

Directors' Stock Plan. At the 1991 annual meeting, the company's stockholders
adopted a Directors' Stock Plan pursuant to which each nonemployee director is
granted 400 shares (adjusted to reflect the 1992 two-for-one stock split) of
Pitney Bowes restricted common stock annually as part of his or her
compensation. On May 10, 1993, an aggregate of 3,600 such shares was awarded,
with each of the nine nonemployee directors then serving receiving 400 shares of
restricted common stock. The shares carry full voting and dividend rights but

7
<PAGE>

may not be transferred or alienated until the later of (1) termination of
service as a director, or, if earlier, the date of a change of control or (2)
the expiration of the six-month period following the grant of such shares.

Directors' Retirement Plan. The company maintains a Directors' Retirement Plan.
Under this plan, a director with five or more years of service as a director
will receive an annual retirement benefit calculated as 50 percent of the
director's retainer in effect at the time of such director's retirement for
directors with five years of service, and an additional 10 percent of such
retainer for each year of service over five to a maximum of 100 percent of such
retainer for ten or more years of service. The current annual retainer fee paid
to active directors who are not officers is $24,000. The annual benefit is paid
for life to a director who (i) leaves the board on or after age 60, or (ii)
leaves the board prior to age 60 but defers commencement of receipt of benefits
until age 60. A director who leaves the board and who elects receipt of benefits
before age 60 shall receive the annual benefit only during a period equal to the
number of years that the director served on the board. Individuals who are
eligible for pension benefits as prior employees of the company are not eligible
under the Directors' Retirement Plan, unless they serve as nonemployee directors
for at least five years.

STOCK PERFORMANCE GRAPH

The following line graph compares the cumulative total return on an investment
in the company's common stock over the five-year period ending December 31,
1993, with that of the Standard & Poor's ("S&P") 500 Composite Index and with an
index which is a combination of the cumulative total returns on an investment in
each company included in the S&P Office Equipment and Supplies Index and the S&P
Computer Systems Index at December 31, 1993, over the same five-year period.

Comparison of Five-Year Cumulative Total Return*
Among Pitney Bowes Inc., the S&P 500 Composite Index, and the Companies
Included in the S&P Office Equipment and Supplies and Computer Systems Indices

[The table below was represented by a graph in the printed Notice & Proxy]

1988 1989 1990 1991 1992 1993
---- ---- ---- ---- ---- ----
PBI 100 114 98 159 206 218
S&P 500 100 132 128 166 179 197
S&P Off. Eq/Comp. Sys. 100 85 91 86 70 75

* Based upon an initial investment of $100 on December 31, 1988, with
reinvestment of dividends

8
<PAGE>

Both the S&P 500 Composite Index and the index that reflects the combined
returns of companies in the S&P Office Equipment and Supplies and the S&P
Computer Systems indices are market-value weighted indices. All information
shown above is based upon data provided to the company by three separate
independent organizations, all three of which have been licensed by Standard &
Poor's Corporation to use its official total return calculation.

The graph shows that on a total return basis, assuming reinvestment of all
dividends, $100 invested in the company's common stock on December 31, 1988
would have grown to $218 by December 31, 1993. By comparison, $100 invested in
the S&P 500 Composite Index would have grown to $197 by December 31, 1993.
Additionally, $100 invested in the index that reflects the combined returns of
companies in the S&P Office Equipment and Supplies and the S&P Computer Systems
indices would have been worth $75 on December 31, 1993.

EXECUTIVE OFFICER COMPENSATION

The Executive Compensation Committee (the "Committee"), which is composed of
three independent nonemployee directors, oversees the company's executive
compensation programs and establishes its executive compensation policies. (A
description of the Committee's duties are shown under the heading "Committees of
the Board of Directors" on page 5.) The Committee reports on executive
compensation to all of the independent nonemployee directors of the board (the
"Independent Directors") and makes recommendations to the Independent Directors
regarding specific executive officer compensation matters with respect to which
the Independent Directors have final approval. (See "Report on Executive
Compensation by the Independent Directors" on page 13.)

Summary Compensation Table. The following table, Table I, shows all compensation
paid or granted, during, or with respect to, the 1993 fiscal year and the two
previous fiscal years, for services rendered in all capacities while an
executive officer, to the chief executive officer and the four highest paid
executive officers. (Persons in this group are referred to herein individually
as an "Executive Officer" and collectively as "Executive Officers.") This table
shows all cash compensation, including Performance Based Compensation
(hereinafter referred to as "PBC Incentive"), which is an annual cash incentive
granted under the Pitney Bowes Key Employees' Incentive Plan (the "KEIP"), which
plan was approved by the company's stockholders. This table also shows the
number of stock options granted during each such year and the value of
previously-granted long-term incentives that were paid in each year as a result
of the achievement of the related three-year performance objectives.

9
<PAGE>

TABLE I

SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation Long-term compensation
----------------------------------- --------------------------------
Grants Payouts
------ -------
Long-term
incentive
PBC Other annual Stock plan All other
Salary Incentive compensation options payouts compensation
Name and principal position Year ($) ($) ($) (#)(1) ($)(2) ($)(3)
--------------------------------- ---- --------- -------- ------------ ------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
George B. Harvey...................... 1993 676,667 585,000 -- 14,550 1,067,943 32,066
Chairman, President & Chief 1992 637,500 564,800 -- 19,300 1,738,550 9,610
Executive Officer 1991 610,000 533,300 -- 18,800 0 --

Marc C. Breslawsky.................... 1993 404,375 322,700 -- 6,250 484,913 6,767
President - Office Systems 1992 377,792 359,800 -- 8,300 661,925 2,059
1991 353,875 348,400 -- 8,200 0 --

Hiro R. Hiranandani................... 1993 393,400 322,700 -- 6,250 484,913 17,659
President - Mailing Systems 1992 371,542 359,800 -- 8,300 661,925 5,354
1991 345,625 291,500 -- 8,200 0 --

Carole F. St. Mark.................... 1993 354,223 276,000 -- 6,250 422,892 6,552
President - Logistics 1992 333,802 227,900 -- 7,300 614,075 4,984
Systems & Business Services 1991 315,625 176,400 -- 7,200 0 --

Carmine F. Adimando................... 1993 317,500 233,800 -- 3,800 316,082 6,659
Vice President - Finance and 1992 295,000 221,200 -- 4,900 534,325 3,897
Administration, and Treasurer 1991 274,583 220,400 -- 4,800 0 --

<FN>
- --------------
(1) Numbers shown for 1991 have been restated to reflect the 1992 two-for-one
stock split.

(2) The value shown for 1993 is the aggregate of the value of the payout of
Cash Incentive Units ("CIUs") granted on June 10, 1991 and the December
31, 1993 market value of restricted stock granted on June 10, 1991. Payout
under the CIUs was based on the magnitude of achievement against the
related financial criteria over a three-year period ending December 31,
1993. (See footnote 1 to Table IV.) The restrictions on the stock were
released due to the attainment of the three-year performance objectives.
(See footnote 2 to Table IV.) The value of the restricted stock prior to
release of restrictions had grown 38.9 percent as the stock price had
increased from $29.781/share on June 10, 1991, to $41.375/share on
December 31, 1993.

(3) Includes amounts contributed to the Pitney Bowes Deferred Investment Plan
on behalf of Messrs. Harvey, Hiranandani and Adimando and Ms. St. Mark,
and to the Dictaphone Corporation Savings With Extra Potential Plan on
behalf of Mr. Breslawsky. Both plans were adopted in accordance with
Section 401(k) of the Internal Revenue Code.

</FN>
</TABLE>

10
<PAGE>

Other Compensation Tables. Tables II-IV below show additional detail about
Executive Officer compensation, specifically, cash-based and stock-based
long-term incentives granted under the company's compensation plans. Long-term
incentives in the form of options granted during the three fiscal years covered
by Table I are shown in that table. Outstanding options were granted under the
1979 Pitney Bowes Stock Option Plan (the "1979 Plan"), which provides only for
the granting of options, and the Pitney Bowes 1991 Stock Plan (the "1991 Plan"),
which provides for the granting of various stock-based incentives including
options; both plans were approved by the company's stockholders. (The 1979 Plan,
the 1991 Plan and the KEIP are sometimes collectively referred to herein as the
"Incentive Plans.")

The following table, Table II, shows additional detail regarding options granted
during 1993 pursuant to the 1991 Plan.

TABLE II

STOCK OPTION GRANTS IN 1993

<TABLE>
<CAPTION>
Net Potential
Realizable Value at
assumed annual rates
% of total of stock price
Options options Exercise or appreciation for
granted granted to base price option term(2)
in 1993 employees ($/share) --------------------
Name (#) in 1993 (1) Expiration date 5% ($) 10% ($)
----------------------------- ------- --------- --------- --------------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
George B. Harvey................. 14,550 5.11 42.375 June 13, 2003 387,749 982,632
Marc C. Breslawsky............... 6,250 2.20 42.375 June 13, 2003 166,559 422,093
Hiro R. Hiranandani.............. 6,250 2.20 42.375 June 13, 2003 166,559 422,093
Carole F. St. Mark............... 6,250 2.20 42.375 June 13, 2003 166,559 422,093
Carmine F. Adimando.............. 3,800 1.33 42.375 June 13, 2003 101,268 256,632

<FN>
- --------------
(1) The exercise price equals the market price of a share of the
company's common stock on the date of grant. These options become
exercisable in installments over a three-year period, one-third after
the first year, one-third after the second year, and one-third after
the third year.

(2) The 5 and 10 percent growth rates, which rates are specified by the
Securities and Exchange Commission, illustrate that the potential
future value of the options to the Executive Officer is linked
directly to the future growth of the price of the company's common
stock. Because the exercise price for options granted equaled the
market price of the common stock on the date of grant, no gain to the
Executive Officer is possible without an increase in the stock price,
which would benefit the company's stockholders as a whole. Zero
growth in the stock price will result in zero realizable value to the
Executive Officers. The 5 and 10 percent growth rates are intended
for illustration only and are not intended to be predictive of future
growth; the actual value, if any, that may be realized by any
Executive Officer will depend on the market price of the common stock
on the date of exercise.

</FN>
</TABLE>

11
<PAGE>

Shown in Table III below is information regarding the exercise of options in
1993 by the Executive Officers and information regarding their total outstanding
options at December 31, 1993.

TABLE III

OPTIONS EXERCISED IN 1993 AND 1993 YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
Number of
Securities Underlying Net Value of
Shares Unexercised Options Unexercised in-the- Money
Acquied Net Value at Year-End (#) (1) Options at Year-End) ($) (2)
on Exercise Realized ------------------------ ----------------------------
Name (#) ($) Exercisable Unexercisable Exercisable Unexercisable
---------------------------- ---------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
George B. Harvey 17,224 497,620 258,409 38,425 5,931,369 262,788
Marc C. Breslawsky 8,400 212,362 88,175 16,575 1,588,841 113,675
Hiro R. Hiranandani 7,600 168,448 62,575 16,575 1,074,604 113,675
Carole F. St. Mark 10,200 284,431 49,825 15,325 844,089 99,909
Carmine F. Adimando 4,000 98,125 41,025 9,875 719,345 66,872

<FN>
- --------------
(1) Options granted during the period 1984-1993. The numbers have been
adjusted to reflect the 1986 and the 1992 two-for-one stock splits.
Options become exercisable in installments over a three-year period,
25 percent after the first year, 25 percent after the second year,
and 50 percent after the third year for all options granted prior to
1993; and at one-third after the first year, one-third after the
second year, and one-third after the third year for options granted
in 1993.

(2) These values are based on $41.375 per share, the market price of a
share of common stock as of December 31, 1993, net of exercise prices
which range from $7.25 to $42.6785 (adjusted to reflect the 1986 and
the 1992 stock splits). In all cases the exercise price equaled the
market price of a share at the date of grant.
</FN>
</TABLE>

Table IV, which follows, shows additional detail regarding other long-term
incentives granted under the Incentive Plans in 1993. Long-term incentives are
contingent upon the attainment of one or more specified performance objectives.
The company is obligated, under the terms of these incentives, to make the
specified payments, if any, only to the extent that the stated performance
objectives are achieved. In 1993 two types of long-term incentives were granted,
restricted stock (shares of the company's stock, the full ownership of which is
restricted and subject to forfeiture) and Cash Incentive Units ("CIUs"), which
represent a defeasible right to receive cash, the amount of which is contingent
upon the attainment of specified performance objectives over a multi-year
period.

12
<PAGE>

TABLE IV

1993 LONG-TERM INCENTIVE PLAN GRANTS

<TABLE>
<CAPTION>
Estimated Future Payouts under
Number of Non-Stock Price-Based Plans
shares, units or --------------------------------------------------
other rights Performance or other Threshold Target Maximum
---------------- period until ---------- --------------- ---------------
CIUs R/S maturation or CIU R/S CIU R/S CIU R/S
Name (1) (2) payout (1) (2) ($) (#) ($) (#) ($) (#)
----------------------- -------- ----- ------------------- --- ----- ------- ----- ------- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
George B. Harvey.......... 514,571 7,400 December 31, 1995 0 3,700 514,571 7,400 804,017 7,400
Marc C. Breslawsky........ 232,842 3,200 December 31, 1995 0 1,600 232,842 3,200 363,816 3,200
Hiro R. Hiranandani....... 232,842 3,200 December 31, 1995 0 1,600 232,842 3,200 363,816 3,200
Carole F. St. Mark........ 232,842 3,200 December 31, 1995 0 1,600 232,842 3,200 363,816 3,200
Carmine F. Adimando....... 172,527 1,950 December 31, 1995 0 975 172,527 1,950 269,573 1,950

<FN>
- --------------
(1) CIUs granted under the Pitney Bowes KEIP represent a defeasible right to
receive cash payments if certain earnings per share and return on
stockholders' equity performance criteria are achieved over a three-year
period ending December 31, 1995, CIUs that will mature on December 31,
1995 will pay $0/CIU if the threshold levels are not exceeded. The CIUs
will have a value of $.0075 to $1.5625 per unit if the earnings per share
and return on stockholders' equity performance criteria are met, depending
on the actual magnitude of achievement.

(2) Restricted stock granted under the Pitney Bowes 1991 Stock Plan is subject
to forfeiture if certain minimum earnings per share performance criteria
are not achieved over a three-year period or if the individual is not
employed with the company on the specified determination date. If the
threshold level of growth is achieved, 50 percent of the restricted stock
will be released. If the target level is achieved or exceeded, one hundred
percent of the restricted stock will be released. A prorated amount will
be released for achievement between the threshold and the target level of
growth. Outstanding shares of restricted stock were granted to the
Executive Officers on June 8, 1992 and June 13, 1993 as follows: Mr.
Harvey, 9,800 and 7,400 shares respectively; Mr. Breslawsky, 4,200 and
3,200 shares, respectively; Mr. Hiranandani, 4,200 and 3,200 shares,
respectively; Ms. St. Mark, 3,700 and 3,200 shares, respectively; and Mr.
Adimando, 2,500 and 1,950 shares, respectively. The aggregate number of
shares of restricted stock held by the Executive Officers as of December
31, 1993 (exclusive of shares that were released to the Executive Officers
after such date), and the aggregate fair market value of such shares is as
follows: Mr. Harvey, 17,200 shares ($711,650); Mr. Breslawsky, 7,400
shares ($306,175); Mr. Hiranandani, 7,400 shares ($306,175); Ms. St. Mark,
6,900 shares ($285,488); and Mr. Adimando, 4,450 shares ($184,119).
(Market value is calculated at $41.375 per share, the market price of the
common stock on December 31, 1993.) The value of shares released after
December 31, 1993 is included in Table I under the heading "Long-Term
Incentive Plan Payouts." Individuals granted restricted stock in 1992 and
1993 have voting rights and receive dividends with respect to the stock
during the restricted period.

</FN>
</TABLE>

Report on Executive Compensation by the Independent Directors

Introduction

The executive compensation policies and programs are the responsibility of the
Executive Compensation Committee (the "Committee"), which consists of three
independent directors. The Committee, in turn, recommends for final approval
certain policies, programs and specific actions to all of the

13
<PAGE>

independent directors of the board (the "Independent Directors.")

The company's philosophy is to compensate employees fairly and competitively in
the markets in which it competes for talent. Thus, it has developed a strategy
which is designed to attract, motivate, and retain the best people to achieve
the company's business objectives. The design of the compensation program
permits recognition of individual contributions as well as results of the
respective business units.

The company's executive compensation program has been designed with four main
objectives: (1) To provide total compensation which is competitive when compared
to various markets; (2) To place a portion of annual compensation at risk
subject to performance against objectives; (3) To divide total compensation
between annual and long-term components with a major portion represented by
long-term performance related components; and (4) To align long-term
compensation with stockholder interests.

In 1993, the Committee reviewed all features of the executive compensation
program to ensure that, when combined, the individual components still meet the
objectives of the program and to ensure that total compensation is competitive
as it relates to the responsibilities and performance of the executives. This
included a review and discussion of material from the company's primary
executive compensation consulting firm and other similar firms, and covered in
detail the competitiveness of base salary, total annual compensation, and total
long-term compensation. The company's compensation information was compared to
that of companies deemed to be in its industry group, including some of the
companies in the S&P 500 and the S&P Office Equipment and Supplies or the S&P
Computer Systems indices referenced in the performance graph, shown on page 8.
The company's compensation information was also compared to that of other
companies of similar revenue size and in different geographical areas because
the Committee believes that the competing marketplace for executive talent is a
larger universe of companies than only those in the company's industry group.
During this review, the Committee assessed the levels of compensation, the mix
of compensation, the individual and financial performance objectives for PBC
Incentives, CIUs and restricted stock, the competitiveness of the individual and
combined components, and the effectiveness of compensation in supporting the
achievement of the company's objectives.

The executive compensation program and established objectives described above
are applied to all the company's executives. Although each executive does not
receive each long-term incentive (described below) as part of his or her
compensation, the mix provided each executive reflects the company's objectives
of linking a portion of compensation to performance and of providing an
incentive for long-term achievement.

The Committee reviews and recommends to the Independent Directors the
compensation of the most highly compensated executives (approximately 0.1
percent of the total employees in the company, referred to herein as "Key
Executives"), including the compensation of the Executive Officers named in the
preceding compensation tables (see Tables I-IV above). It also establishes the
policies for and reviews the annual PBC Incentive and stock options granted to
executives who comprise approximately 1 percent of the total employees of the
company (referred to herein as "All Executives"). This complete review by the
Committee is designed to ensure equity, consistency, fairness, and the
appropriateness of these grants.

Annual Compensation

Base Salary. In general, the company establishes base pay for All Executives at
what it believes to be less than competitive levels based on information
provided by the company's consultants. The company, however, believes its PBC
Incentives to be more than competitive, thus providing compensation that is
competitive overall but which places more annual pay at risk.

The determination of an individual Executive Officer's pay is based on the
executive's level of experience, position in the salary range, individual
performance against annually established unit and individual objectives,

14
<PAGE>

including financial and non-financial measures, competitive market rates for
similar positions, and the established annual criteria for merit increases. The
above considerations apply similarly to All Executives.

On February 1, 1993, Mr. Harvey's annual base salary was increased from $640,000
to $680,000, a 6.25 percent increase. This increase, recommended by the
Committee, and approved by the Independent Directors, recognized his 1992
accomplishments against various corporate objectives, for example: revenue, net
income, earnings per share, improvement of customer satisfaction, and continued
efforts in workforce diversity. While all factors are significant, the heaviest
weighting is applied to the financial objectives. As has been the case
historically, Mr. Harvey's base salary is low as compared to salaries of chief
executives of comparable companies. The company places more emphasis on PBC
Incentive and long-term incentives, which vary based on performance.

PBC Incentive. All Executives, including the Executive Officers, are eligible
for PBC Incentives for achieving specific, significant annual unit and/or
individual objectives.

For performance which meets objectives established at the beginning of the year,
PBC Incentives are paid at target percentage amounts; maximum amounts are paid
for performance which is exceptional; reduced amounts are paid for acceptable
but less than expected performance; and no amount is paid for performance that
is unsatisfactory. The target PBC Incentives are designed so that when combined
with base salaries, which the Committee believes are lower than competitive, the
total places more pay at risk than is the competitive average. The Committee
intends that payment of base salary plus a target PBC Incentive be competitive
with total annual compensation paid in the marketplace. For performance which is
exceptional against the preestablished objectives, the Committee intends that
the total annual compensation be higher than average.

The PBC Incentives for the Executive Officers are reviewed by the Committee and
approved by the Independent Directors. The approval of the recommended
incentives follows a detailed discussion of the company's and the individual's
performance for that year against objectives which were established at the
beginning of that fiscal year.

In 1993, Mr. Harvey guided the company to achieve several objectives of short
and long-term significance established by the Independent Directors. These
objectives were similar to the financial and other objectives described above
under "Base Salary" with the financial objectives receiving the greatest
weighting. Based upon these accomplishments, Mr. Harvey was rated as having
performed against these preestablished objectives at a level that exceeded
target, and as a result, Mr. Harvey received $585,000 as a PBC Incentive for his
1993 performance. This represents a 3.58 percent increase from his 1992 PBC
Incentive.

Long-Term Incentives

In 1993, the company utilized three types of long-term incentives. These three
are: CIUs, restricted stock, and stock options. The Committee uses these
performance-driven components to link executive compensation to internal company
performance, and to external market performance of the company's stock price.
These incentives also enable the company to provide the Executive Officers with
an economic interest in the long-term future growth of the company's business
and of the market price of its stock, and provide an incentive for the Executive
Officers to continue employment with the company. Grants of all three components
are recommended by the Committee and approved by the Independent Directors. The
combination of these three long-term incentives granted during 1993 was compared
to long-term incentives granted by comparable companies to ensure that the total
was competitive. The potential value of, or rights to, two of these
incentives--CIUs and restricted stock--is contingent upon the attainment of one
or more specified performance objectives. Amounts are paid or rights given, if
any, only to the extent that the stated performance objectives are achieved. The
potential future value of stock options, which are granted with an exercise
price equal to the market price of the stock at the date of grant, is completely
dependent upon the future increase in the price of the company's stock.

15
<PAGE>

CIUs. In 1993, CIUs were granted to Key Executives including the Executive
Officers. CIUs represent the right to receive cash only if certain specified
financial objectives are achieved. The amount paid pursuant to CIUs is linked to
the attainment of certain earnings per share rates and return on stockholder
equity growth over a three-year period. Hence, the potential value of the CIUs
is directly linked to the company's performance.

If the company's performance on the two financial measures equals the
pre-established targeted growth rates, CIUs are paid at a target rate of
$1.00/CIU. For performance below the target level, the CIUs pay at a rate from
$.99 to $.0075/CIU, and payment decreases to zero if the performance slips to 75
percent or less of the performance target. Payment reaches a maximum payout of
$1.5625/CIU when the performance equals or exceeds 150 percent of the target
growth rate.

For the cycle 1993-1995, ending December 31, 1995, Mr. Harvey was granted
514,571 CIUs which are subject to the attainment of cumulative three-year
earnings per share and return on stockholder equity objectives. For the
1991-1993 cycle, ending on December 31, 1993, the payout of CIUs was at the rate
of $1.43 per unit because the financial targets established in 1991 were
exceeded.

Stock-Based Incentives

In 1993, the company also granted under its long-term incentive program two
types of stock-based incentives which serve to provide Key Executives, including
the Executive Officers, with a direct interest in the stock price and the
long-term growth of the company. These two incentives are shares of restricted
stock and stock options.

Restricted Stock. Restricted stock granted in 1993 is subject to both a
financial performance and a tenure requirement. The restrictions on the shares
are released, in total or in part, only if the executive is still employed by
the company at the end of the performance period and if the performance
objective of compound earnings per share growth over the applicable three-year
period has been achieved.

If the performance objective is achieved or exceeded, all of the restricted
shares are released. If the compound three-year earnings per share growth is
less than 75 percent of the target rate, the shares are forfeited. If
performance is at 75 percent of the target rate, 50 percent of the shares are
released and the balance is forfeited. For performance between 75 percent and
the target level, the shares are released on a proportionate basis, with the
unearned balance being forfeited.

On June 13, 1993, Mr. Harvey was granted 7,400 shares of restricted stock. On
the date of grant, the market price of the stock was $42.375 per share. The
release of restrictions relating to these shares is to be determined based on
performance over a three-year period ending December 31, 1995. In deciding to
grant these shares to Mr. Harvey, the Independent Directors considered the
number of restricted shares then held by Mr. Harvey and determined that the
number of shares to be granted in 1993 represented an appropriate component of
the total compensation package for Mr. Harvey for 1993. It is the practice of
the Independent Directors to review each year Mr. Harvey's total compensation
package for competitiveness at the time approved. It is the belief of the
Independent Directors that, when previously granted, the outstanding restricted
stock was an appropriate component of the total compensation packages that they
then approved.

For the 1991-1993 cycle, ending on December 31, 1993, the restrictions on 9,600
shares (adjusted for the 1992 two-for-one stock split) granted to Mr. Harvey on
June 10, 1991 were released as the performance objective relating to the
three-year period was exceeded. The market price of the stock when granted was
$29.781 per share (adjusted for the 1992 two-for-one stock split).

Stock Options. In granting stock options to All Executives, including the
Executive Officers, the intent is to provide an incentive to increase the price
of the stock. The exercise price of options has always been equal to 100 percent
of the market price of the company's common stock on the date of grant. Options
have a ten-year life span, but only become exercisable in installments during
the first three years following their grant.

16
<PAGE>

During 1993, Mr. Harvey was granted 14,550 options with an exercise price of
$42.375 per share, which equaled the market price of the stock on the date of
grant. In determining the number of options to be granted to Mr. Harvey, the
Independent Directors considered the number of stock options then held by Mr.
Harvey and determined that the number of options to be granted for 1993
represented an appropriate component of Mr. Harvey's total compensation package
for 1993. It is the practice of the Independent Directors to review each year
Mr. Harvey's total compensation package for competitiveness at the time
approved. It is the belief of the Independent Directors that, when previously
granted, the outstanding options were an appropriate component of the total
compensation packages for the respective years that they then approved.

Conclusion

As described above and as reflected in the 1993 compensation of the Executive
Officers, it is the Committee's and the company's philosophy to link a portion
of the compensation of All Executives to individual and business performance and
to provide All Executives with compensation that creates a direct interest in
the long-term growth of the company's stock price. Further, with respect to Key
Executives, the company's practice has been to link a significant portion of
total compensation to company performance and to have a greater portion
represented by long-term compensation.

Beginning in 1994, publicly traded corporations generally will not be permitted
to deduct compensation in excess of $1 million paid to certain top executives
unless the compensation qualifies for an exception as "performance-based
compensation" as described under proposed regulations of the Internal Revenue
Service. Based upon an analysis of the expected compensation of the Executive
Officers named in the preceding compensation tables, which compensation the
Committee does not believe will be excessive, it is the intent of the Committee
that none of the company's deductions for 1994 compensation will be disallowed
under this "$1 million cap." However, because the law is new, and the Internal
Revenue Service has not yet promulgated its final interpretive regulations, it
is not possible to determine its impact on the company with complete certainty.
The Committee intends to continue to review this issue.

Linda G. Alvarado John C. Emery, Jr. Leroy D. Nunery
William E. Butler Charles E. Hugel Phyllis Shapiro Sewell
Colin G. Campbell David T. Kimball Arthur R. Taylor

Severance and Change Of Control Arrangements

The company maintains a Severance Plan to provide a period of continued income
to employees who are terminated by certain actions of the company, and to
encourage all employees, including the Executive Officers, to continue to carry
out their duties in the event of the possibility of a Change of Control. "Change
of Control" is defined as the acquisition of 20 percent of the company's common
stock or 20 percent or more of the combined voting power of all voting
securities by an individual, entity or group, or a change of more than a
majority of the board other than by approval of the then-current board, or
approval by the stockholders of a reorganization, merger, or dissolution of the
company.

The Severance Plan provides for the payment of severance to employees, including
the Executive Officers, whose employment with the company or any of its United
States subsidiaries is terminated under certain circumstances (exclusive of a
Change of Control) of a minimum of one week of pay for each full year of service
(a fraction thereof for a partial year of service), with a minimum of two weeks'
pay, and a maximum of two years' pay. The Severance Plan also provides that
employees whose employment is terminated or whose position, authority, pay or
benefits are diminished within two years after a Change of Control will be
entitled to severance pay on the basis of their position levels and seniority.
If these Change of Control conditions were to arise, Executive Officers would be
entitled to four weeks' severance pay for each year employed by the company or
its subsidiaries, with a minimum of one year's pay, and a maximum of two years'
pay.

The 1979 Plan and the 1991 Plan each provide that in the event of a Change of
Control, options granted under the plans become immediately and fully
exercisable. The 1991 Plan also provides that, in the event of a Change of
Control, other outstanding stock-based incentives granted pursuant to the plan

17
<PAGE>

become fully vested, with all performance objectives deemed fully satisfied
except for transfer restrictions required for exempt treatment under Section 16
of the Securities Exchange Act of 1934, as amended, or any other applicable law.

The KEIP provides that, in the event of a Change of Control, All Executives,
including the Executive Officers, shall have a vested right to PBC Incentives
with respect to the year in which such Change of Control occurs and to CIUs
which are then outstanding (for Key Executives), in amounts to be determined by
the Independent Directors as specified in the plan on the basis of relevant past
performance of the individual executive, of his or her division and of Pitney
Bowes, as applicable. Such PBC Incentives and CIU payments would be made shortly
after the Change of Control, discounted to present value at the prime rate then
in effect. The KEIP provides with respect to outstanding shares of restricted
stock, or units entitling a recipient to receive shares granted pursuant to the
plan, that, in the event of a Change of Control, such shares or units will
become fully vested, with all performance objectives or other restrictions
deemed fully satisfied, except for any transfer restrictions required for
exemption under Section 16 of the Securities Exchange Act of 1934, as amended,
or required by any other applicable law.

If any of these benefits, either alone or together with any other payments or
benefits provided to any employee including an Executive Officer, would
constitute an "excess parachute payment" subject to the 20 percent excise tax
under certain provisions of the Internal Revenue Code, the Severance Plan
provides that an additional payment would be made to each affected employee in
order that such excise tax is reimbursed on a net after-tax basis.

It is possible that no payments will ever be made pursuant to the foregoing;
therefore, it is not possible to estimate the amount of any payments that may
become due to any individual under the Severance Plan or the Incentive Plans in
the event of a Change of Control.

Pension Benefits

The following table shows estimated annual retirement benefits (rounded to the
nearest dollar) which would be payable to individuals at the compensation levels
of the Executive Officers, at specified years of service classifications under
the Pitney Bowes Retirement Plan, as supplemented by the Pitney Bowes Benefit
Equalization Plan (collectively the "Retirement Plan"). The amounts of annual
benefits shown on the following table are predicated on the assumptions that the
employee retires at age 65, that the employee is to be paid on a single life
annuity basis, and that the amount of Social Security covered wages for each
year of service was more than the Social Security maximum for 1993. The amount
of compensation shown under the columns "Annual Compensation" on the Summary
Compensation Table (Table I) on page 10 is substantially the same as
compensation that is the basis for benefits under the Retirement Plan, which is
referred to as "Final Average Earnings" on the following table. The estimated
annual benefits are not subject to any further deduction for Social Security
benefits.

18
<PAGE>

PENSION BENEFITS
PROXY STATEMENT
<TABLE>
<CAPTION>

YEARS OF SERVICE
FINAL AVG. ------------------------------------------------------------------------------------------------
EARNINGS 10 15 20 25 30 35 40
--------- -------- -------- -------- -------- -------- -------- --------

Messrs. Harvey (age 62), Breslawsky (age 51), Hiranandani (age 56), Adimando
(age 49), and Ms. St. Mark (age 51), have 37, 13, 17, 15 and 14 years of
credited service (rounded to the nearest whole year), respectively, under the
Retirement Plan as of February 28, 1994.

Approval of Appointment of Pitney Bowes' Independent Accounts

The Audit Committee of the board has recommended, and the board has approved for
vote by stockholders, the continuation of Price Waterhouse as the independent
accountants for Pitney Bowes for 1994.

Price Waterhouse has served in this capacity continuously since 1934. Price
Waterhouse has no direct or indirect financial interest in Pitney Bowes or any
of its subsidiaries. Representatives of Price Waterhouse will be present at the
annual meeting of stockholders and will have the opportunity to make a statement
and to respond to appropriate questions.

Under Delaware corporation law, the affirmative vote of the holders of a
majority of the stock entitled to vote represented in person or by proxy at the
meeting (each share of $2.12 preference stock counting as eight votes of common
stock) is required to approve the appointment of independent accountants. If a
majority of the shares voted at the meeting is not voted in favor of such firm,
the board of directors will consider what action should be taken.

The board recommends that stockholders vote FOR the above proposal.

Stockholder Proposals for 1995 Annual Meeting

Under the rules of the Securities and Exchange Commission, proposals for
stockholder action at the 1995 annual meeting, including nomination of
directors, must be received by the Secretary of the company no later than
November 30, 1994, if such proposals are to be included in the company's proxy
statement and form of proxy.

In addition, the company's by-laws provide certain procedures that a stockholder
must follow to nominate persons for election as directors or to introduce an
item of business at an annual meeting, even if such item is not to be included
in the company's proxy statement and form of proxy. Such procedural requirements
are fully set forth in the company's by-laws, a copy of which may be obtained
without charge by any stockholder by contacting the Secretary of the company at
the address and telephone number set forth on the cover of this proxy statement.
To have a nomination or item of business brought before the 1995 annual meeting,
a stockholder must deliver the requisite notice of such nomination or item to
the Secretary of the company at its executive offices no later than February 7,
1995.

19
<PAGE>

Solicitation of Proxies

In addition to the use of the mails, proxies may be solicited by the directors,
officers, and employees of Pitney Bowes without additional compensation by
personal interview, by telephone, or by telegram. Arrangements may also be made
with brokerage firms and other custodians, nominees, and fiduciaries for the
forwarding of solicitation material to the beneficial owners of Pitney Bowes
common and $2.12 preference stock held of record, and Pitney Bowes will
reimburse such brokers, custodians, nominees, and fiduciaries for reasonable
out-of-pocket expenses incurred. Pitney Bowes has retained Chemical Bank to aid
in the solicitation of proxies. The anticipated fee of such firm is $8,500 plus
out-of-pocket costs and expenses. The cost of solicitation will be borne
entirely by Pitney Bowes.

Other Matters

The management knows of no other matters which may be presented for
consideration at the meeting. However, if any other matters properly come before
the meeting, it is the intention of the individuals named in the enclosed form
of proxy to vote in accordance with their judgment.

The 1993 annual report was distributed by mail several days prior to the
distribution of this notice and proxy statement. If you did not receive a copy
of the company's 1993 annual report or would like a copy of the company's Form
10-K for 1993, you may request copies by contacting the Secretary of the company
at the address and telephone number set forth on the cover of this proxy
statement.

By order of the board of directors.

Douglas A. Riggs
Vice President, Communications, Planning,
Secretary and General Counsel

20
<PAGE>

[Map of showing Pitney Bowes Stamford Facilities location]

<PAGE>

DIRECTIONS:

Northbound on I-95

Please take Exit 7 (Greenwich Avenue) and proceed through the first
intersection to next traffic light where you should turn right onto
Washington Blvd. Continue 1/2 mile to stop sign. Turn left onto S.
Pacific Street and take immediate right onto Dyke Lane. At the end of
Dyke Lane, turn left onto Elmcroft Road. Please park where indicated.

Southbound on I-95

Please take Exit 7 (Atlantic Street). At the second traffic light, turn
left onto Atlantic Street and continue through second traffic light to
stop> sign and turn left onto Washington Blvd. At next stop sign turn
left onto S. Pacific Street and take immediate right onto Dyke Lane. At
the end of Dyke Lane, turn left onto Elmcroft Road.Please park where
indicated.

From the Merritt Parkway

Please take Exit 34 (Long Ridge Road). Turn south onto Long Ridge Road.
Follow Long Ridge Road for approximately 2 miles to Cold Spring Road and
turn right onto Cold Spring Road. Bear left onto Washington Blvd. and
follow to the end (approximately 2 miles). At stop sign make a left turn
onto S. Pacific Street and take an immediate right onto Dyke Lane. At
the end of Dyke Lane turn left onto Elmcroft Road. Please park where
indicated.

<PAGE>

PROXY -- COMMON STOCK AND $2.12 PREFERENCE STOCK
PITNEY BOWES INC.

Annual Meeting of Stockholders May 9, 1994

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

George B. Harvey, Carmine F. Adimando, Douglas A. Riggs, or any of them, with
power of substitution, are hereby appointed proxies of the undersigned to vote
all common stock and $2.12 preference stock of Pitney Bowes Inc. owned by the
undersigned at the annual meeting of stockholders to be held in Stamford,
Connecticut, on May 9, 1994, or any adjournments or postponements thereof, upon
such business as may properly come before the meeting, including the following
items, as set forth in the notice of meeting and proxy statement:

1. Election of directors.

2. Appointment of independent accountants.

All shares of $2.12 preference stock and common stock registered in your name
and/or held for your benefit in the dividend reinvestment plan are shown on this
card. The shares represented hereby will be voted in accordance with the
directions given by the stockholder. If a properly signed proxy is returned
without choices marked, and if not otherwise directed, the shares represented by
this proxy will be voted FOR Items 1 and 2.

(Continued, and to be signed, on the other side)

<PAGE>
/X/ Please mark
your vote
like this

--------------- --------------- ----------------
COMMON D.R. SHARES $2.12 PREFERENCE

The Board of Directors Recommends a Vote FOR Items 1 and 2.

Item 1 -- Election of Directors

For all nominees Withhold William E. Butler, David T. Kimball,
(except as marked (as to all Leroy D. Nunery, Arthur R. Taylor
to the contrary) nominees)

/_/ /_/

(Write a nominee's name on the space provided below to withhold authority to
vote for that individual nominee.)

- --------------------------------------------------------------

Item 2 -- Appointment of Price Waterhouse as independent accountants

FOR AGAINST ABSTAIN

/_/ /_/ /_/

In their discretion, the Proxies are authorized to vote upon such other business
as may properly come before the meeting, or any adjournment thereof. Please
mark, date and sign, and return promptly this proxy in the enclosed envelope,
which requires no postage if mailed in the U.S.A. When signing as attorney,
executor, administrator, trustee or guardian or in other representative
capacities, please give your full title as such.

Signature(s) of Stockholder(s) _______________________________ Date ______, 1994