Business Editors

    WASHINGTON--(BUSINESS WIRE)--Aug. 2, 1999--The U.S. Postal Service and Pitney Bowes Inc. (NYSE:PBI) announced today that they had reached agreement resolving a lawsuit filed by Pitney Bowes in 1997. The lawsuit arose out of a dispute over a 1978 Statement of Understanding authorizing Pitney Bowes to offer Postage by Phone(R), its proprietary version of the Computerized Meter Resetting System (CMRS).

CMRS, first offered by Pitney Bowes in 1979, enables customers to reset their postage meters over telephone lines. In 1995, as a part of a review of its cash management practices and postage meter policies, the Postal Service revised its regulations for CMRS and terminated the 1978 Statement of Understanding. The Court upheld the revised regulations but ordered a trial on the merits of Pitney Bowes' claim for money damages.

Under the terms of the agreement, Pitney Bowes will receive $51.75 million. This payment will represent a portion of the financial benefit that the Postal Service obtained as a result of the revised regulations.

     --30--et/ny*

     CONTACT:  U.S. Postal Service Contact: 
               Greg Frey, 202/268-2168
               http://www.usps.com
                 or
               Pitney Bowes:
               Media Contact: 
               Sheryl Battles, 203/351-6808
                 or
               Financial Contact: 
               Charles McBride, 203/351-6349
               http://www.pitneybowes.com

     KEYWORD: DISTRICT OF COLUMBIA CONNECTICUT
     INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS COMED GOVERNMENT