SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Mechanical Technology Incorporated
(Name of Issuer)
$1.00 Par Value Common Stock
(Title of Class of Securities)
583538103
(CUSIP Number)
Howard Kelberg, Esq.
Winthrop, Stimson, Putnam & Roberts
One Battery Park Plaza
New York, New York 10004
(212) 858-1334
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
March 26, 1996
(Date of Event which Requires
Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
Schedule because of Rule 13d- 1(b)(3) or (4), check the following:
Check the following box if a fee is being paid with this
Statement: X
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SCHEDULE 13D
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CUSIP NO. 583538103 |
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1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
First Albany Companies Inc.
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) o
(b) X
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
WC
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) o
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
First Albany Companies Inc. is organized under the laws
of the State of New York
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NUMBER OF SHARES 7. SOLE VOTING POWER
127,607
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BENEFICIALLY OWNED BY 8. SHARED VOTING POWER
296,250
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EACH PERSON WITH 9. SOLE DISPOSITIVE POWER
127,607
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10. SHARED DISPOSITIVE POWER
0
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
423,857 (including 296,250
pursuant to two limited purpose proxies)
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12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES o
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT ON ROW (11)
11.9%
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14. TYPE OF REPORTING PERSON
CO
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SCHEDULE 13D
Item 1. Security and Issuer.
The class of equity securities to which this statement relates
is the $1.00 par value common stock (the "Shares") of Mechanical Technology
Incorporated, a New York corporation (the "Issuer").
The principal executive offices of the Issuer are located at
968 Albany - Shaker Road, Latham, New York 12110.
Item 2. Identity and Background.
This statement is being filed by First Albany Companies Inc.,
a New York Corporation ("FAC"). FAC is a holding company which, through its
principal wholly-owned subsidiary, First Albany Corporation ("First Albany"), is
an investment banking, securities trading and brokerage firm serving
corporations, governments and institutional and individual investors. The
address of FAC's principal office and principal business is 30 South Pearl
Street, Albany, New York 12207-1599.
The name, business address and present principal occupation or
employment of each executive officer and director (the "Executive Officers and
Directors") of FAC are set forth in Schedule I hereto, which is incorporated
herein by reference.
Neither FAC nor any of the Executive Officers and Directors
has, during the last five years, been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors).
Neither FAC nor any of the Executive Officers and Directors
has, during the last five years, been a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction and as a result of
such proceeding was or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject to federal
or state securities laws or finding any violation with respect to such laws,
except that in 1992 First Albany and Michael Lindburg, its Chief Compliance
Officer, without admitting or denying the findings of fact or conclusions of
law, consented in an administrative proceeding instituted by the Securities and
Exchange Commission to a finding that First Albany and Lindburg failed
reasonably to supervise a registered representative,
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<PAGE>
who was subject to their supervision, with a view to preventing violations of
Section 17(a) of the Securities Act, Section 10(b) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act") and Rule 10b-5 thereunder, within
the meaning of Sections 15(b)(4)(E) and 15(b)(6) of the Exchange Act and that
First Albany willfully violated Section 7(c) of the Exchange Act and Regulation
T thereunder, and Rule 10b-6 of the Exchange Act. In connection with such
findings, Mr. Lindburg consented to a one-year supervisory suspension and First
Albany agreed to retain a consultant to review and report upon the policies,
procedures and practices of First Albany designed to detect and prevent
violations of the federal securities law.
Each of the individuals listed in Schedule I hereto is a
citizen of the United States of America, except for J. Anthony Boeckh, Ph.D.,
who is a citizen of Canada.
Item 3. Source and Amount of Funds or Other Consideration.
On September 28, 1995, First Albany purchased 101,900 Shares
in the open market for an aggregate price of $95,531 ($.9375 per Share), and on
January 16, 1996, First Albany purchased 25,707 Shares in the open market for an
aggregate price of $16,710 ($.65 per Share). The source of funds for both
purchases was working capital. On April 4, the 127,607 Shares were transferred
to FAC.
Item 4. Purpose of Transaction.
The purpose of the acquisition of securities of the Issuer
described herein is to influence the Board of Directors and the management of
the Issuer, to assist in the revitalization of the Issuer, and for investment.
FAC intends to seek representation on the Issuer's Board of Directors.
On March 26, 1996, FAC received a limited purpose proxy
(included as Exhibit A hereto and incorporated herein by reference) from Ford
Motor Company relating to 156,250 Shares beneficially owned by Ford Motor
Company and on March 28, 1996, FAC received a limited purpose proxy (included as
Exhibit B hereto and incorporated herein by reference) from Atlas Copco AB
relating to 140,000 Shares beneficially owned by Atlas Copco AB (collectively,
the "Proxy Shares"). Such proxies authorized FAC to vote such Shares for an
adjournment of the Issuer's 1996 Annual Stockholders Meeting, which was
originally scheduled for March 28, 1996. Without a formal vote of stockholders
(and therefore, without exercise of such proxies), such meeting has been
adjourned to May 16, 1996.
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<PAGE>
FAC is currently negotiating with a significant shareholder of
the Issuer to purchase 909,091 Shares and certain indebtedness of the Issuer. In
connection with such negotiations and FAC's request for approval of such
transactions by the Board of Directors of the Issuer pursuant to Section 912 of
the New York Business Corporation Law, FAC has delivered letters to the Board of
Directors of the Issuer and to a board member (attached as Exhibits C, D and E
hereto and incorporated by reference herein (collectively, the "Board
Correspondence")), as described in Item 6 below. The Board Correspondence sets
forth, among other things, that FAC plans (based on the current economic
condition of the Issuer) to assist in the revitalization of the Issuer by
enhancing the Issuer's balance sheet through the ultimate infusion of
approximately $2,000,000 in new equity. FAC also plans to maintain the Issuer as
a viable going concern that provides jobs and economic opportunities in the New
York capital region. FAC also intends, through the contemplated stock and debt
purchases, to act in the best interests of the Issuer and does not intend to
strip the assets of the Issuer, do a leveraged buyout, squeeze out minority
shareholders or merge the Issuer with FAC or any of its subsidiaries. Reference
is made to Item 6 hereof and the copies of the Board Correspondence attached
hereto and incorporated by reference herein for additional information regarding
the Board Correspondence.
From time to time, FAC has engaged in discussions with the
Issuer, its officers and directors and other significant shareholders relating
to the Issuer's policies, management, directors, business, operations, financial
condition, strategies and other developments, and FAC intends to engage in such
discussions in the future. FAC intends to discuss with the officers and
directors of the Issuer and certain other significant shareholders changes in
the present Board of Directors and the designation of certain persons to serve
as members of the Board of Directors as representatives of FAC, to be considered
and acted upon at the adjourned 1996 Annual Stockholders Meeting on May 16,
1996.
From time to time, FAC may buy or sell additional Shares, on
the open market, in private negotiated purchases, from the Issuer or otherwise.
Notwithstanding the foregoing, as a significant shareholder of
the Issuer and through any representation that it may have on the Issuer's Board
of Directors, FAC may consider, from time to time, (i) an extraordinary
corporate transaction, such as a merger, reorganization or liquidation,
involving the Issuer or any of its subsidiaries, (ii) a sale or transfer of a
material amount of assets of the Issuer or any of its subsidiaries, (iii)
material changes in the present capitalization or dividend policy of the Issuer,
(iv) other material changes in the Issuer's business or corporate structure, (v)
changes in the Issuer's charter and bylaws or other actions which may impede the
acquisition of control of the Issuer by any
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<PAGE>
person, (vi) causing a class of securities of the Issuer to be delisted from a
national securities exchange or to cease to be authorized in an inter-dealer
quotation system of a registered national securities association, (vii) causing
a class of equity securities of the Issuer to become eligible for termination of
registration pursuant to Section 12(g)(4) of the Securities Exchange Act of
1934, as amended or (viii) any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Issuer.
(a) FAC is the direct beneficial owner of 127,607 Shares. On
March 26, 1996, FAC became the beneficial owner of an additional 156,250 Shares
by acquiring a limited purpose proxy from Ford Motor Company and on March 28,
1996, became the beneficial owner of an additional 140,000 Shares by acquiring a
limited purpose proxy from Atlas Copco AB, in each case limited to vote the
respective Proxy Shares for adjournment of the Issuer's 1996 Annual Stockholders
Meeting. Such Shares in the aggregate constitute approximately 11.9% of the
outstanding Shares of the Issuer.
(b) FAC has the sole power to direct the vote and disposition
of all Shares directly owned by it as described in paragraph (a). FAC's ability
to direct the vote of the Proxy Shares is limited to the power to vote for
adjournment of the Issuer's 1996 Annual Stockholders Meeting. Atlas Copco AB and
Ford Motor Company retain sole power to direct the vote (other than with respect
to such adjournment) and the disposition of their respective Proxy Shares.
(c) Except as described Items 3, 4, 5 and 6 hereof, neither
FAC nor any Executive Officer and Director has effected any transactions in
Shares during the past 60 days.
(d) No other person is known to have the right to receive or
the power to direct the receipt of dividends from, or the proceeds from the sale
of, such Shares, other than the Proxy Shares, which power is retained by Ford
Motor Company and Atlas Copco AB, respectively.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or
Relationships With Respect to Securities of the Issuer.
FAC received limited purpose proxies from Ford Motor Company
and Atlas Copco AB to vote for adjournment of the Issuer's 1996 Stockholders
Meeting.
In connection with its negotiations to purchase 909,091 Shares
and certain indebtedness of the Issuer from a significant shareholder and FAC's
request for approval of such transactions by the Board of Directors of the
Issuer pursuant to Section 912 of the New York Business Corporation Law, on
March 28, 1996, FAC
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<PAGE>
delivered a letter to the Board of Directors (attached as Exhibit C hereto and
incorporated herein by reference), in which, among other things, FAC expressed
its plans to assist in the revitalization of the Issuer. On March 28, 1996, FAC
also delivered a similar letter to a board member (attached as Exhibit D hereto
and incorporated herein by reference) and an on April 3, 1996, FAC delivered an
additional letter to the Board of Directors (attached as Exhibit E hereto and
incorporated herein by reference).
In the letter dated April 3, 1996, FAC represented, among
other things, that it is its intention to assist in the recapitalization of the
Issuer in order to preserve and enhance the economic benefits it brings to the
New York capital region. FAC indicated that is not its intention to enter into
any transactions with the Issuer other than to negotiate a restructuring or
refinancing of the purchased indebtedness and, specifically, that FAC shall not
(i) merge with the Issuer, (ii) cause the consolidation of the Issuer into FAC
or any of its subsidiaries or (iii) participate as a principal in the sale or
lease of greater than 10% of the assets of the Issuer. FAC also represented that
if the Issuer and the Board of Directors determine that a rights offering is in
the best interests of the Issuer and its shareholders, FAC shall either abstain
or recuse itself from any vote of shareholders or, if it is represented on the
Board of Directors, any vote of the directors, on such an issue.
In the same letter, the Issuer also indicated that, in
negotiating and discussing any restructuring of the indebtedness that it is
negotiating to purchase, FAC will consider certain options, including (i)
restructuring such debt on terms and conditions more favorable than currently
exist and on terms and conditions at least comparable to those existing in the
marketplace at the time of the restructuring, (ii) conversion of the debt to
preferred stock, (iii) conversion of the debt to common stock (at a per share
price of not less than $1.50 per share) and (iv) some combination of the options
that the Issuer or the Board presents. The letter indicates that any
restructuring would be subject to the approval by a majority of disinterested
directors of the Board of Directors. The letter also indicates that FAC will
propose raising approximately $2 million in equity pursuant to a private
placement.
Item 7. Material to be Filed as Exhibits.
Exhibit A - Limited purpose proxy of Ford Motor Company
Exhibit B - Limited purpose proxy of Atlas Copco AB
Exhibit C - Letter from FAC to the Issuer's Board of Directors, dated
March 28, 1996
Exhibit D - Letter from FAC to Issuer Board Member, dated March 28,
1996
Exhibit E - Letter from FAC to Issuer Board Member, dated April 3,
1996
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<PAGE>
After reasonable inquiry and to the best knowledge and belief
of the undersigned, the undersigned certifies that the information set forth in
this statement is true, complete and correct.
DATED: April 5, 1996 FIRST ALBANY COMPANIES INC.
By: /s/ Michael R. Lindburg
--------------------------
Name: Michael R. Lindburg
Title: Secretary
<PAGE>
SCHEDULE I
INFORMATION WITH RESPECT TO
DIRECTORS AND EXECUTIVE OFFICERS OF FIRST ALBANY COMPANIES INC.
The following table sets forth the name and present principal
occupation or employment of the current directors and executive officers of
First Albany Companies Inc. Except as otherwise indicated below, the present
business address of each such executive officer and director is 30 South Pearl
Street, Albany, New York 12207-1599.
PRESENT PRINCIPAL
NAME OCCUPATION OR EMPLOYMENT
George C. McNamee Chairman, director and Co- Chief
Executive Officer of FAC and First
Albany.
Alan P. Goldberg Director, President and Co- Chief
Executive Officer of FAC and First
Albany
Daniel V. McNamee III President of The Publishing & Media
Director Group, a management consulting firm
specializing in the media communications
industry. His present business address
is 475 Fifth Avenue, 19th Floor, New
York, New York 10017.
J. Anthony Boeckh, Ph.D. Chairman and Chief Executive Officer of
Director BCA Publications Ltd., Montreal, Canada,
and Editor-in-Chief of The Bank Credit
Analyst. He is also a principal of
Greydanus, Boeckh and Associates, Inc.,
Montreal, Canada, a fixed income
specialty manager. His principal
business address is BCA Publications
Ltd., 1002 Sherbrooke St. West, Ste.
1600, Montreal, Canada H3A3L6.
<PAGE>
PRESENT PRINCIPAL
NAME OCCUPATION OR EMPLOYMENT
Honorable Hugh L. Carey He is Chairman of the Board of Advisers
Director of Cambridge Partners, L.L.C. (an
investment banking company) and of
counsel to the law firm of Whitman,
Breed, Abbot & Morgan. His principal
business address is 65 East 55th Street,
suite 3300, New York, New York
10022-3219.
Hugh A. Johnson Director, Senior Vice President and
Director Chief Investment Officer of FAC and
First Albany and Chairman of First
Albany Asset Management Corporation.
Benaree P. Wiley President and Chief Executive Officer of
Director The Partnership, a Boston-based
organization founded by business and
civic leaders to promote the development
of professionals of color through access
to corporate, municipal and state
leaders. Her principal business address
is 334 Boylston St., Suite 400, Boston,
MA 02116.
Charles L. Schwager Consultant to Loanet, Inc., a provider
Director of on-line, real time accounting
services to support financial
institutions engaged in the business of
borrowing and lending securities. His
principal business address is 12B Manor
Parkway, Salem, NH 03079.
Edwin T. Brondo Vice President of FAC Senior Vice
President and Chief Administrative
Officer of First Albany.
<PAGE>
PRESENT PRINCIPAL
NAME OCCUPATION OR EMPLOYMENT
David J. Cunningham Vice President and Chief Financial
Officer of FAC and Senior Vice President
and Chief Financial Officer of First
Albany.
Michael R. Lindburg Vice President, Secretary and General
Counsel of FAC and Sr. Vice President,
General Counsel, Managing Director of
Retail Sales and Secretary of First
Albany.
<PAGE>
EXHIBIT INDEX
Exhibit A - Limited purpose proxy of Ford Motor Company
Exhibit B - Limited purpose proxy of Atlas Copco AB
Exhibit C - Letter from FAC to the Issuer's Board of Directors, dated March
28, 1996
Exhibit D - Letter from FAC to Issuer Board Member, dated March 28, 1996
Exhibit E - Letter from FAC to Issuer Board Member, dated April 3, 1996
<PAGE>
Exhibit A
LIMITED PROXY
MECHANICAL TECHNOLOGIES, INCORPORATED
The undersigned, Ford Motor Company ("Ford"), appoints George McNamee and
Alan Goldberg, and each of them, to represent Ford at, and to vote, propose and
sign any necessary documents on behalf of Ford in connection with an adjournment
of the Shareholder's Meeting of Mechanical Technologies, Inc. to be held on
Thursday, March 28, 1996 (the "Shareholder's Meeting"). This Limited Proxy is
restricted to matters related to the adjournment of the Shareholder's Meeting
and does not authorize either George McNamee or Alan Goldberg to represent Ford
at, vote, propose or sign any documents on behalf of Ford in connection with any
other matter that may come before the Shareholder's Meeting.
FORD MOTOR COMPANY
By: /s/ PETER SHERRY, JR.
---------------------
Peter Sherry, Jr.
Its: Assistant Secretary
<PAGE>
Exhibit B
PROXY
The undersigned hereby revoke any proxy heretofore given to vote such shares,
and hereby ratify and confirm all that said proxies may do by virtue hereof.
THIS PROXY WILL BE VOTED AS SPECIFIED BY THE SHAREHOLDER.
The undersigned hereby appoint George McNamee and Alan Goldberg, or either of
them, as proxies to vote all the stock of the undersigned with all the powers
which the undersigned would possess if personally present at the Annual Meeting
of the Shareholders of Mechanical Technology Incorporated, to be held at the
Company's corporate offices, 968, Albany-Shaker Road, Latham, New York 12100, at
10:00 a.m. on March 28, 1996, or any adjournment thereof, as follows:
IN THEIR DISCRETION, UPON MOTION BY ANY SHAREHOLDER, FOR ADJOURNMENT
OF THE MEETING.
ATLAS COPCO AB
(publ)
/s/Hans Lindblad /s/Hans Sandberg
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Hans Lindblad Hans Sandberg
Attendance at Meeting: No
<PAGE>
Exhibit C
March 28, 1996
VIA FAX
Board of Directors of
Mechanical Technology Incorporated
968 Albany-Shaker Road
Latham, New York 12110
Dear Members of the Board:
First Albany Companies Inc. ("First Albany") respectfully requests that the
Board of Directors of Mechanical Technology Incorporated (the "Company") approve
its purchase of 909,091 shares of the Company's common stock and approximately
$4 million of the Company's debt (as set forth in that certain Claim
Participation Agreement, as modified, among United Telecontrol Electronics, the
Company and the First Commercial Credit Corporation), from the New York
Superintendent of Insurance as liquidator of United Community Insurance Company
("Superintendent"), pursuant to Business Corporation Law Section 912. We also
request your approval of First Albany's purchase of certain additional shares of
the Company from Mr. Lawrence and certain entities affiliated with Mr. Lawrence,
if First Albany, Mr. Lawrence and/or the Texas Superintendent of Insurance are
able to come to agreement on the terms of such a purchase. Upon acquisition of
the stock and debt from the Superintendent, as set forth above, First Albany
plans to assist in the revitalization of the Company by enhancing the Company's
balance sheet through restructuring of certain debt and the ultimate infusion of
approximately $2,000,000 in new equity. First Albany plans to maintain the
Company as a viable going concern that provides jobs and economic opportunities
in the capital region. The contemplated transaction is intended to assure that
the Company can stay in business and continue to contribute to the economic
health of the region.
If you have any questions about this letter, or I can be of further assistance,
please call me at 518-447-8501.
Yours,
/s/George C. McNamee
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George C. McNamee
Chairman
<PAGE>
Exhibit D
March 28, 1996
Mr. Dennis O'Connor
Mechanical Technology Incorporated
968 Albany-Shaker Road
Latham, NY 12110
Dear Mr. O'Connor:
We write this letter in connection with the meeting among Mechanical
Technology Incorporated (the "Company") Board of Directors and First Albany
Companies Incorporated ("First Albany") this morning. At the meeting, we
informed you of our intention to purchase 909,091 shares of the Company's common
stock and approximately $4 million of the Company's debt (as set forth in that
certain Claim Participation Agreement, as modified, among United Telecontrol
Electronics, the Company and the First Commercial Credit Corporation), from the
New York Superintendent of Insurance as liquidator of United Community Insurance
Company. We further informed you that we are interested in acquiring additional
shares of the Company from Mr. Lawrence and certain entities affiliated with Mr.
Lawrence.
We want to take this opportunity to assure you that it is our intention,
through these contemplated stock and debt purchases, to act in the best
interests of the Company. Specifically, we intend to assist in the
revitalization of the Company by enhancing the Company's balance sheet through
restructuring of certain debt and the ultimate infusion of approximately
$2,000,000 in new equity. We plan to maintain the Company as a viable going
concern that provides jobs and economic opportunities in the capital region. We
want to further assure you, personally, that First Albany does not intend to
strip the assets of the Company, do a leveraged buyout, squeeze out minority
shareholders or merge the company with First Albany Companies or any of its
subsidiaries. Our proposal is made to help assure that the Company can stay in
business and continue to contribute to the financial health of the region.
Accordingly, we respectfully request that you approve First Albany's stock and
debt purchase as set forth above, pursuant to Section 912 of the New York State
Business Corporation Law.
Sincerely,
/s/George C. McNamee
--------------------
George C. McNamee
Chairman
<PAGE>
Exhibit E
April 3, 1996
Dear Member of the Board:
This letter is intended to be read in context with our letters of
March 28, 1996 to the Board of Directors of MTI and Mr. Dennis O'Connor; and is
further intended to clarify First Albany's intentions and plans as presented at
the meeting with the Board of Directors of MTI on March 28, 1996; and to respond
to concerns which have been expressed to us since that time.
Accordingly, First Albany represents and reiterates that:
1. It is our intention to acquire the referenced shares of MTI
common stock and the Claim Participation Agreement for the purposes of
investments to be held in our corporate account. It is further our intention to
assist in the recapitalization of MTI in order to preserve and enhance the
economic benefits it brings to the capital region. Such a recapitalization has
been and remains a publicly stated objective of MTI's management and presumably
its Board of Directors.
It is not our intention to enter into any transactions with the
company other than to negotiate a restructuring or refinancing of the Claim
Participation Agreement as referenced below. Specifically, First Albany shall
not (a) merge with the Company, (b) cause the consolidation of the Company into
First Albany or any of its subsidiaries; or (c) participate as a principal in
the sale or lease of greater than ten percent of the assets of the Company.
2. Should the Company and the Board of Directors determine that a
rights offering is in the best interests of the Company and its shareholders,
First Albany shall either abstain or recuse itself from any vote of shareholders
or, should we be represented on the Board of Directors, any vote of the
directors, on such an issue.
3. With respect to negotiations and discussions concerning
restructuring of the debt evidenced by the Claim Participation Agreement, First
Albany shall consider certain options, to include, but not limited to: (a)
restructuring of the debt on terms and conditions more favorable than currently
exist pursuant to the Claim Participation Agreement as amended and on terms and
conditions that are at least comparable to those existing in the marketplace at
the time of the restructuring; (b) conversion of the debt to preferred stock;
(c) conversion of the debt to common stock provided however, that the per share
price of such stock shall not be less than $1.50 per share; (d) some combination
of the options that the Company or the Board may present for consideration by
First Albany. Any agreement as
<PAGE>
to the restructuring of the Debt shall be subject to the approval by a majority
of disinterested directors of the Board of Directors.
4. First Albany shall propose that approximately $2 million in
equity be raised pursuant to a private placement to not more than thirty
accredited investors. First Albany is aware of a significant level of interest
in such a private placement and is prepared to move ahead to solicit such
investors immediately upon an agreement with the Board of Directors on the
terms, conditions and pricing of such an offering. Such proposal shall be
subject to approval by a majority of disinterested directors of the Board.
We believe the foregoing representations should convince the Board
that approval of First Albany's contemplated stock and debt acquisition,
pursuant to Section 912 of the Business Corporation Law, is in the best
interests of the Company. Furthermore, upon receipt of your approval we are
prepared to begin discussions and serious negotiations immediately with the
Board or its management designees to accomplish the objectives and
representations stated.
We look forward to your prompt request and remain available to meet
with you to answer any additional questions.
Sincerely,
/s/ George C. McNamee
---------------------
George C. McNamee
Chairman
<PAGE>
