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Pitney Bowes Updates Status of Proposed Spin-Off

Friday, March 10, 2006

Press release from the issuing company

STAMFORD, Conn., March 9 -- Pitney Bowes Inc. today updated the status of its proposed spin-off of its Capital Services external financing business based on recent communication initiated by the company with the staff of the Securities and Exchange Commission (SEC). The SEC staff indicated that the company would need to include three years of historical audited financial statements for the legal entity holding the assets of the Capital Services external financing business rather than for the Capital Services business alone. Fulfillment of this requirement could extend the timeframe for completion of the spin into 2007. As a result, consistent with its previously stated desire to exit the Capital Services business in a way that maximizes shareholder value, the company is assessing a broader range of asset and business disposition options, including a spin-off, a sale of the business, or a sale of all or a portion of the assets. Several factors, including improved economic conditions, make this range of options more attractive now than when the company first announced its intention to look at options for exiting this business in January 2003. The company also announced that it has signed a definitive agreement to sell its Imagistics International, Inc. lease portfolio for approximately $280-$290 million to De Lage Landen Operational Services, LLC, a subsidiary of the Rabobank Group. The final purchase price will be a function of the receivables balance in the portfolio at closing. This lease portfolio is part of the Capital Services external financing assets included in the proposed spin-off. The completion of the sale of the Imagistics lease portfolio is subject to customary closing conditions. In addition, if the company decides to pursue the spin-off in its current form, the sale will be subject to receipt of a supplemental Internal Revenue Service ruling that the proposed spin-off of the Capital Services external financing business will be tax-free to Pitney Bowes shareholders. Capital Services provides commercial financing solutions for non-Pitney Bowes equipment in three areas: Capital Equipment, Vendor Financing, and Commercial Real Estate. At the end of 2004, the Company's Board of Directors approved a plan to pursue a spin-off, contingent upon certain events.




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