This excerpt taken from the PBI DEF 14A filed Mar 23, 2006.
Exercise and Lapse of Options
Options are normally only exercisable within six months from the end of the Savings Contract. Options can only be exercised using the proceeds of the Savings Contract, including the tax-free bonus. If an option holder does not wish to exercise, he or she may still benefit from the proceeds of the Savings Contract, including the tax-free bonus.
Options granted under the SAYE Plan also become exercisable upon the following events:
Options generally lapse six months after becoming exercisable (one year in the case of death). They also lapse upon the option holders being adjudicated bankrupt. If an option holder does not retire at age 65, he or she may choose to wait until the end of the Savings Contract before exercising.
The maximum number of Shares that can be acquired on the exercise of an option is the number that can be acquired using the proceeds of the Savings Contract at the time of exercise.
If Pitney Bowes is acquired by another company by tender offer, that other company may agree to allow option holders to exchange options granted under the SAYE Plan for new options for shares in that other company or one of its affiliates, so long as the new options and the new shares meet certain requirements intended to ensure that they are equivalent to the old options. The approval of the U.K. H M Revenue and Customs to such an exchange is required.