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This excerpt taken from the PBI DEF 14A filed Mar 26, 2009. Stock Options The independent members of the board of directors are responsible for stock option grants to the chief executive officer and executive chairman. The Committee is responsible for grants to all of the other executive officers of the company. An annual grant of stock options is made to executives at the Committee’s or, in the case of the chief executive officer and executive chairman, the board’s meeting during the first quarter of the year. This is typically after our fourth quarter earnings release has been widely disseminated. The Committee may, from time to time, grant stock options to new executive hires; these grants are typically made at the Committee’s next regularly scheduled meeting. In special circumstances, the Committee may determine that it is appropriate to make additional grants to executives (other than the chief executive officer and the executive chairman) during the course of the year; these grants are made at a Committee meeting. The company’s stock price must increase in order for stock option grantees to realize any benefit. When the stock price increases, both stockholders and stock option grantees will benefit. On February 11, 2008, the named executive officers, except for Messrs. Critelli and Nolop, were awarded an annual grant of stock options to purchase common stock of the company under the 2007 Stock Plan at an exercise price of $36.96 per share, the closing price of the company’s common stock on February 11, 2008. The stock options have a ten-year exercise period and will vest and become exercisable in equal 25% increments over four years after the date of grant. The maximum amount of stock options that may be awarded to any individual in any plan year under the 2007 Stock Plan is 600,000. Since Mr. Martin’s grant would have exceeded this amount, he received the maximum amount of stock options and the remainder of his long-term incentive award value in CIUs. 24
25 This excerpt taken from the PBI DEF 14A filed Mar 27, 2008. Stock Options It is the company’s policy that stock options are granted only at an exercise price equal to the market price of the stock on the date of grant. In accordance with the 2002 Stock Plan, the market price is the average of the high and low prices at which Pitney Bowes stock was traded on the New York Stock Exchange on the date of grant. The Pitney Bowes Inc. 2007 Stock Plan, approved by stockholders on May 14, 2007, defines market price as the closing price for Pitney Bowes stock on the New York Stock Exchange on the date of grant. The independent members of the board of directors are responsible for option grants to the company’s president and chief executive officer and executive chairman. The Committee is responsible for grants to all of the other executive officers of the company. An annual grant of stock options is made to executives at the Committee’s or, in the case of the president and chief executive officer and executive chairman, the board’s meeting during the first quarter of the year. The Committee may, from time to time, grant options to new executive hires; these grants are typically made at the Committee’s next regularly scheduled meeting. In special circumstances, the Committee may determine that it is appropriate to make additional grants to executives (other than the executive chairman and the chief executive officer) during the course of the year; these grants are made at a Committee meeting. Also, in accordance with Delaware law, the board has delegated to the chief executive officer and the chief human resources officer authority to grant stock options within pre-established guidelines to employees at the level of vice president and below. The Committee reviews any grants 26 made pursuant to this delegation at its next regularly scheduled meeting. The company’s stock price must increase in order for stock option grantees to realize any benefit. When the stock price increases, both stockholders and stock option grantees will benefit. In 2007, 1,488,387 options were granted with a weighted average exercise price of $47.17, the average of the high and low trading prices of Pitney Bowes common stock on that date. The closing market price for Pitney Bowes stock was $47.83 on that date. Options typically have a ten-year exercise period. Generally, nonqualified stock options become exercisable ratably (25% each year) over the first four years following the date of grant and incentive stock options become exercisable after four years. We typically grant options on the same date as the meeting of the Committee in February each year. This is typically after our fourth quarter earnings release has been widely disseminated. In connection with Mr. Martin’s promotion to chief executive officer, Mr. Martin was awarded an annual grant of 324,149 stock options to purchase common stock of the company under the 2002 Stock Plan at an exercise price of $45.40 per share, the average of the high and the low price of the company’s common stock on March 16, 2007 (the “Grant Date Fair Market Value”). This grant was in line with the median competitive market data. The stock options have a ten-year exercise period and will vest and become exercisable in equal 25% increments over four years after the date of grant. Consistent with Mr. Critelli’s election to the newly created position of executive chairman, Mr. Critelli was awarded an annual grant of 162,075 stock options to purchase common stock of the company under the 2002 Stock Plan at $45.40 per share, the Grant Date Fair Market Value. The stock options have a ten-year exercise period and will vest and become exercisable in equal 25% increments over four years after the date of grant. This excerpt taken from the PBI DEF 14A filed Apr 3, 2007. Stock Options. It is the company’s policy that stock options are granted only at an exercise price equal to the market price of the stock on the date of grant.
In accordance with our Stock Plan, the market price is the average of the high and low prices at which Pitney Bowes stock was traded on the New York Stock Exchange on the date of grant. The Pitney Bowes Inc. 2007 Stock Plan defines market price as
the closing price for Pitney Bowes stock on the New York Stock Exchange on the date of grant. The Pitney Bowes Inc. 2007 Stock Plan is subject to approval by the stockholders; see page 24 under the heading “Proposal 3: Approval of the Pitney
Bowes Inc. 2007 Stock Plan.”
In 2006, 1,922,500 options were granted on February 13 with an exercise price of $42.62, the average of the high and low trading prices of Pitney Bowes common stock on that date. The closing market price for Pitney Bowes stock was $42.51 on that date. Options typically have a ten-year exercise period. Generally, nonquali-fied stock options become exercisable ratably (25% each year) over the first four years following the date of grant and incentive stock options become exercisable after four years. We typically grant options on the same date as the meeting of the Committee in February each year. This is typically after our fourth quarter earnings release has been widely disseminated. The independent members of the board of directors are responsible for option grants to the company’s chief executive officer and chief operating officer. The Committee is responsible for grants to all of the other executive officers of the company. An annual grant of stock options is made to executives at the Committee’s or, in the case of the chief executive officer and chief operating officer, the board’s, meeting during the first quarter of the year. The Committee may, from time to time, grant options to new executive hires; these grants are typically made at the Committee’s next regularly scheduled meeting. In special circumstances, the Committee may determine that it is appropriate to make additional grants to executives (other than the chief executive officer and the chief operating officer) during the course of the year; these grants are made at a Committee meeting. Also, in accordance with Delaware law, the board has delegated to the chief executive officer and the chief human resources officer authority to grant stock options within pre-established guidelines to employees at the level of vice president and below. The Committee reviews any grants made pursuant to this delegation at its next regularly scheduled meeting. The company’s stock price must increase in order for stock option grantees to realize any benefit. When the stock price increases, both stockholders and stock option grantees will benefit.
This excerpt taken from the PBI 10-Q filed Nov 9, 2006. Stock Options Under our stock plan, certain officers and employees are granted options at prices equal to the market value of our common shares at the date of grant. Options granted in 2004 and prior thereto generally become exercisable in three equal installments during the first three years following their grant and expire after ten years. Options granted in 2005 and thereafter generally become exercisable in four equal installments during the first four years following their grant and expire ten years from the date of grant. At September 30, 2006, there were 10,409,324 options available for future grants under this plan. The following table summarizes information about stock option transactions:
The weighted-average remaining contractual life of the options outstanding and exercisable at September 30, 2006 was 6.9 years and 5.9 years, respectively. The intrinsic value of the options outstanding and exercisable at September 30, 2006 was $112.1 million and $104 million, respectively. Beginning in 1997, certain employees eligible for performance-based compensation may defer up to 100% of their annual awards, subject to the terms and conditions of the Pitney Bowes Deferred Incentive Savings Plan. Participants may allocate deferred compensation among specified investment choices. Previously the investment choices offered included stock options under the U.S. stock option plan. Stock options acquired under this plan were generally exercisable three years following their grant and expired after a period not to exceed ten years from the date of grant. There were 255,987 options outstanding under this plan at September 30, 2006, which are included in outstanding options under the U.S. stock option plan. Beginning with the 2004 plan year, options were not offered as an investment choice and therefore there were no options granted in 2004 and thereafter. We estimate the fair value of stock options using a Black-Scholes valuation model, consistent with the provisions of SFAS 123(R), SEC Staff Accounting Bulletin No. 107 and our prior period pro forma disclosures of net earnings, including stock-based compensation (determined under a fair value method as prescribed by SFAS 123(R)). Key input assumptions used to estimate the fair value of stock options include the volatility of our stock, the risk-free interest rate and our dividend yield. We believe that the valuation technique and the approach utilized to develop the underlying assumptions are appropriate in estimating the fair value of our stock option grants. Estimates of fair value are not intended to predict actual future events or the value ultimately realized by employees who receive equity awards, and subsequent events are not indicative of the reasonableness of the original estimates of fair value we made under SFAS 123(R). The fair value of stock options granted during the nine months ended September 30, 2006 and 2005 and related assumptions were as follows:
1 – Our estimates of expected stock price volatility are based on historical price changes of our stock. 2 – The risk-free interest rate is based on U.S. Treasuries with a term equal to the expected option term. 3 – The expected life is based on historical experience. 18 PITNEY BOWES INC. This excerpt taken from the PBI 10-Q filed Aug 8, 2006. Stock Options Under our stock plan, certain officers and employees are granted options at prices equal to the market value of our common shares at the date of grant. Options granted in 2004 and prior thereto generally become exercisable in three equal installments during the first three years following their grant and expire after ten years. Options granted in 2005 and thereafter generally become exercisable in four equal installments during the first four years following their grant and expire ten years from the date of grant. At June 30, 2006, there were 10,008,641 options available for future grants under this plan. The following table summarizes information about stock option transactions:
The weighted-average remaining contractual life of the options outstanding and exercisable at June 30, 2006 was 6.8 years and 5.9 years, respectively. The intrinsic value of the options outstanding and exercisable at June 30, 2006 was $82.6 million and $80.9 million, respectively. Beginning in 1997, certain employees eligible for performance-based compensation may defer up to 100% of their annual awards, subject to the terms and conditions of the Pitney Bowes Deferred Incentive Savings Plan. Participants may allocate deferred compensation among specified investment choices. Previously the investment choices offered included stock options under the U.S. stock option plan. Stock options acquired under this plan were generally exercisable three years following their grant and expired after a period not to exceed ten years from the date of grant. There were 277,297 options outstanding under this plan at June 30, 2006, which are included in outstanding options under the U.S. stock option plan. Beginning with the 2004 plan year, options were not offered as an investment choice and therefore there were no options granted in 2004 and thereafter. We estimate the fair value of stock options using a Black-Scholes valuation model, consistent with the provisions of SFAS 123(R), SEC Staff Accounting Bulletin No. 107 and our prior period pro forma disclosures of net earnings, including stock-based compensation (determined under a fair value method as prescribed by SFAS 123(R)). Key input assumptions used to estimate the fair value of stock options include the volatility of our stock, the risk-free interest rate and our dividend yield. We believe that the valuation technique and the approach utilized to develop the underlying assumptions are appropriate in estimating the fair value of our stock option grants. Estimates of fair value are not intended to predict actual future events or the value ultimately realized by employees who receive equity awards, and subsequent events are not indicative of the reasonableness of the original estimates of fair value we made under SFAS 123(R). The fair value of stock options granted during the six months ended June 30, 2006 and 2005 and related assumptions were as follows:
1 – Our estimates of expected stock price volatility are based on historical price changes of our stock. 2 – The risk-free interest rate is based on U.S. Treasuries with a term equal to the expected option term. 3 – The expected life is based on historical experience. 18 PITNEY BOWES INC. | EXCERPTS ON THIS PAGE:
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