FIRST ALBANY COMPANIES Inc.
Stock Bonus Plan
Form 11K
For the Plan Year Ended 12/31/94
<PAGE>
Securities and Exchange Commission
Washington, DC 20549
FORM 11-K
[X] Annual Report Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
For the fiscal year ended December 31, 1994
or
[ ] Transition Report Pursuant to Section 15(d) of
the Securities Exchange Act of 1934
Commission file number 014140
First Albany Companies Inc. Stock Bonus Plan
(Title of Plan)
First Albany Companies Inc.
(Issuer of Securities)
41 State Street
Albany, New York 12201
(518) 447-8500
(Address of Principal Executive Office)
I.R.S. Employer I.D. No. 22-2655804
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ITEMS
Item 4. Financial Statements and Schedules
1. Report of Independent Accountants
A. Statement of net assets available for plan benefits
as of December 31, 1994 and 1993
B. Statements of changes in net assets available for plan
benefits for the years ended December 31, 1994, 1993
and 1992
C. Notes to financial statements
D. Assets held for investment at December 31, 1994
E. Transactions in excess of 5% of the current value of plan
assets for the year ended December 31, 1994.
24. Consent of Independent Accountants
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the plan) have duly caused this annual
report to be signed on its behalf by the undersigned hereunto duly authorized.
First Albany Companies Inc.
Stock Bonus Plan
DATE: March 28, 1995 BY: /s/ George C. McNamee
-------------- ---------------------------
George C. McNamee
Member of the Administrative
Committee
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THE FIRST ALBANY COMPANIES INC.
STOCK BONUS PLAN
REPORT OF INDEPENDENT ACCOUNTANTS
For the Years Ended December 31, 1994, 1993 and 1992
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TABLE OF CONTENTS
Page
REPORT OF INDEPENDENT ACCOUNTANTS 1
FINANCIAL STATEMENTS
Statements of net assets available for plan benefits 2
Statements of changes in net assets available for plan benefits 3
Notes to financial statements 4-6
SUPPLEMENTAL SCHEDULES
Assets held for investment at December 31, 1994 27(a)*
Transactions in excess of 5% of the current value
of plan assets for the year ended December 31, 1994 27(d)*
* Refers to item number in Form 5500 (Annual Return/Report of Employee Benefit
Plan) for plan year ended December 31, 1994, which material is incorporated
herein by reference.
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REPORT OF INDEPENDENT ACCOUNTANTS
To the Administrative Committee
of First Albany Companies Inc. Stock Bonus Plan
We have audited the accompanying statements of net assets available for plan
benefits of First Albany Companies Inc. Stock Bonus Plan as of December 31, 1994
and 1993, and the related statements of changes in net assets available for plan
benefits for each of the three years in the period ended December 31, 1994.
These financial statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of the Plan as
of December 31, 1994 and 1993, and the changes in net assets available for plan
benefits for each of the three years in the period ended December 31, 1994, in
conformity with generally accepted accounting principles.
As described in Note 2, in 1993 the plan changed its method of accounting for
liabilities to former plan participants.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules listed in the
accompanying table of contents are presented for the purpose of additional
analysis and are not a required part of the basic financial statements but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. The supplemental schedules have been subjected to the
auditing procedures applied in the audit of the basic financial statements and,
in our opinion, are fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
COOPERS & LYBRAND L.L.P.
Albany, New York
March 17, 1995
1
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<TABLE>
<CAPTION>
FIRST ALBANY COMPANIES INC.
STOCK BONUS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
==============================================================================
December 31, December 31,
1994 1993
------------------------------------------------------------------------------
ASSETS
<S> <C> <C>
Investments, at fair value (Note 4) $6,053,112 $ 5,371,847
Cash, noninterest bearing 161,650 15,335
------- ------
Net assets available for plan benefits $6,214,762 $5,387,182
========== ==========
</TABLE>
The accompanying notes are an integral part of
the financial statements.
2
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<TABLE>
<CAPTION>
FIRST ALBANY COMPANIES INC.
STOCK BONUS PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
=======================================================================================
December 31, December 31, December 31,
For the years ended 1994 1993 1992
---------------------------------------------------------------------------------------
<S> <C> <C> <C>
Additions to net assets attributed to:
Contributions from:
Employees $ 716,130 $ 628,641 $ 396,331
Employer (Note 5) 344,353 292,466 189,740
--------- ------- -------
1,060,483 921,107 586,071
Net (depreciation)appreciation in
the fair value of investments (160,262) 1,064,707 720,100
Dividend income 142,358 109,602 108,895
------- --------- -------
Total additions 1,042,579 2,095,416 1,415,066
--------- --------- ---------
Deductions from net assets attributed to:
Benefits paid or payable to:
Terminated participants 204,684 175,204 200,252
Active participants 10,315 47,096
-------
Total deductions 214,999 222,300 200,252
------- ------- -------
Increase prior to cumulative effect
of a change in accounting principle 827,580 1,873,116 1,214,814
Cumulative effect of a change
in accounting principle 25,168
------- --------- ---------
Net increase 827,580 1,898,284 1,214,814
Net assets available for plan benefits:
Beginning of period 5,387,182 3,488,898 2,274,084
--------- --------- ---------
End of period $6,214,762 $5,387,182 $3,488,898
========== ========== ==========
</TABLE>
The accompanying notes are an integral part of
the financial statements.
3
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FIRST ALBANY COMPANIES INC.
STOCK BONUS PLAN
NOTES TO FINANCIAL STATEMENTS
1. Description of the Plan
The following description of the First Albany Companies Inc. (the "Company")
Stock Bonus Plan (the "Plan") provides only general information.
Participants should refer to the Plan document for a more complete
description of the Plan's provisions.
a. General
Effective July 1, 1987, First Albany Companies Inc. established a Stock
Bonus Plan. This Plan is a defined contribution plan covering
substantially all employees of the Company and its subsidiaries. Employees
are eligible to participate upon the first day of the calendar quarter
following completion of at least one thousand hours of service during any
consecutive twelve months of continuous recognized employment as defined
in the Plan. The Plan is subject to the provisions of the Employee
Retirement Income Security Act of 1974 (ERISA). All costs and fees
incurred in administering the Plan are borne by the Company, which is the
Plan administrator and custodian.
b. Contributions and Participant Accounts
Participants elect to make after-tax contributions to the Plan. The
Company may, but is not required to, contribute to the Plan an amount
equal to a percentage of each participants' voluntary after-tax
contribution. For 1994, 1993 and 1992, the Company's contribution
percentage was 50%. Annually, the Board of Directors of the Company may
authorize an additional contribution to the Plan. Forfeitures are
maintained within the Plan and used to reduce the Company's matching
contribution.
c. Investments
The Plan is limited to investing solely in the common stock of the
Company which is traded in the over-the-counter market, except that
interim short-term investments may be made pending purchase of the
Company's stock. Purchases and sales of the Company's stock are conducted
by the Company's principal subsidiary, First Albany Corporation, a
registered broker-dealer. Commissions are not charged on these
transactions.
d. Vesting
Effective January 1, 1989, participants' vest in employer contributions
and earnings thereon based on years of service. A participant is 100
percent vested after seven years of credited service. Participants'
contributions and earnings thereon are fully vested at all times.
4
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FIRST ALBANY COMPANIES INC.
STOCK BONUS PLAN
NOTES TO FINANCIAL STATEMENTS, Continued
e. Payment of Benefits
On termination of service, participants may receive payment, in cash or
shares, of their vested benefits in a lump-sum distribution equal to the
value of their accounts as of the valuation date, as defined in the Plan.
2. Change in Accounting Principle
During 1993, the plan changed its method of accounting for liabilities to
former plan participants to conform with changes made in the AICPA Audit
and Accounting Guide for Audits of Employee Benefit Plan. Under the prior
method, a liability was recorded for amounts which had been allocated to
participants that had withdrawn from the plan. Beginning in 1993 such
obligations no longer are recorded as a liability in the Plan's financial
statements, but remain classified as net assets available for plan
benefits until distribution. The Plan's Form 5500 (Annual Return/Report of
Employee Benefit Plan) still requires these amounts to be reflected as a
liability until the obligation is distributed. As of December 31, 1994 and
1993, there were no obligations for participants who had withdrawn from
the Plan. For 1992, the net increase in net assets available for Plan
benefits would have decreased $57,919 on a proforma basis.
3. Significant Accounting Policies
The accounting records of the Plan are maintained on the accrual basis.
Investments are stated at market value, which is based upon the last
reported sales price.
The Plan presents, in the statements of changes in net assets, the net
appreciation (depreciation) in the fair value of its investments which
consists of the realized gains or losses and the unrealized appreciation
(depreciation) on those investments.
4. Investments
The Plan's investment portfolio consists of the following as of December
31, 1994 and 1993:
<TABLE>
<CAPTION>
1994 1993
---- ----
Cost Market Value Cost Market Value
------- ------------ ---------- ------------
<S> <C> <C> <C> <C>
Common Stock:
First Albany
Companies Inc. $4,471,954 $6,053,112 $3,566,335 $5,371,847
</TABLE>
5
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FIRST ALBANY COMPANIES INC.
STOCK BONUS PLAN
NOTES TO FINANCIAL STATEMENTS, Continued
The number of shares of First Albany Companies Inc. common stock as of
December 31, 1994 and 1993 was 834,912 and 651,133 respectively. The
realized net gain based on average costs was $64,092, $75,669 and $47,571
for the years ended December 31, 1994, 1993 and 1992, respectively.
The Plan's investment portfolio is subject to daily market price
fluctuations. Since the entire investment portfolio consists of the
Company's common stock, the Plan's portfolio may be exposed to risk in the
event of a decline in the market value of the Company's stock.
5. Forfeitures
The Company applied forfeitures of $13,719, $21,866 and $8,706 to reduce its
matching contribution to the Plan during 1994, 1993 and 1992, respectively.
6. Plan Termination
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contribution at any time and to
terminate the Plan subject to the provisions of ERISA. In the event of Plan
termination, the account of each participant shall become fully vested and
be distributed.
7. Tax Status
The Internal Revenue Service has determined and informed the Company by a
letter dated February 26, 1993, that the Plan and related trust are
designed in accordance with applicable sections of the Internal Revenue
Code (IRC). The Plan has been amended since receiving the determination
letter. However, the Plan administrator believes that the Plan is designed
and is currently being operated in compliance with the applicable
requirements of the IRC.
6
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<TABLE>
<CAPTION>
FIRST ALBANY COMPANIES INC.
STOCK BONUS PLAN
ASSETS HELD FOR INVESTMENT<F*>
December 31, 1994
-------------------
Current
Description Cost Value
------------- ------- -------
<S> <C> <C>
First Albany Companies Inc.:
Common stock ($0.01 - par value) $4,471,954 $6,053,112
========== ==========
<FN>
<F*> The supplemental schedule refers to item number 27(a) in Form 5500
(Annual Return/Report of Employee Benefit Plan).
</FN>
</TABLE>
7
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<TABLE>
<CAPTION>
FIRST ALBANY COMPANIES INC.
STOCK BONUS PLAN
TRANSACTIONS IN EXCESS OF 5% OF THE
CURRENT VALUE OF PLAN ASSETS<F*>
For The year Ended December 31, 1994
(b) (c) (d) (g) (h) (i)
Current value
of asset on
Purchase Selling Cost of transaction Net gain or
Description of asset price price Asset date (loss)
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
First Albany Companies $1,053,288 $211,761 $147,669 $1,793,623 $64,092
(Common Stock)
<FN>
<F*> The supplemental schedule refers to item number 27(d) in Form 5500 (Annual
Return/Report of Employee Benefit Plan).
</FN>
</TABLE>
8
EXHIBIT 24
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statements of
First Albany Companies Inc. on Form S-8 (Registration Nos. 33-35166, 33-15220
and 33-52153) of our report dated March 17, 1995, on our audits of the
statements of net assets available for plan benefits of First Albany Companies
Stock Bonus Plan as of December 31, 1994 and 1993, and the statements of changes
in net assets available for plan benefits for each of the three years in the
period ended December 31, 1994, which report is included in this Annual Report
on Form 11-K.
COOPERS & LYBRAND L.L.P.
Albany, New York
March 17, 1995
