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Registration No. 333-[___]
As filed with the Securities and Exchange Commission on May 20, 1999
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
FIRST ALBANY COMPANIES INC.
(Exact name of issuer as specified in its charter)
New York 22-2655804
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation)
30 South Pearl Street
Albany, New York 12207
(Address of principal executive offices)
FIRST ALBANY COMPANIES INC.
FINANCIAL CONSULTANTS DEFERRED COMPENSATION PLAN
(Full title of Plan)
Stephen P. Wink, Esq.
Secretary and General Counsel
First Albany Companies Inc.
30 South Pearl Street
Albany, New York 12207
(518) 447-8500
(Name, address and telephone number of agent for service)
Copies to:
Winthrop, Stimson, Putnam & Roberts
One Battery Park Plaza
New York, New York 10004
(212) 858-1000
Attention: Susan P. Serota, Esq.
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Maximum Proposed Maximum
Title of Securities to be Amount to be Offering Price Per Aggregate Offering Amount of
Registered Registered Share Price Registration Fee 5/
<S> <C> <C> <C> <C>
Deferred Compensation $3,000,000.00 100% $3,000,000.00 4/ $834.00
Obligations 1/
Common Stock, par value $.01 per 200,000 shares 2/ $14.1875 3/ $2,837,500.00 $0
share
</TABLE>
1. The Deferred Compensation Obligations are unsecured obligations of First
Albany Companies Inc. to pay deferred compensation in the future in accordance
with the terms of the First Albany Companies Inc. Financial Consultants Deferred
Compensation Plan.
2. This Registration Statement shall be deemed to cover additional securities to
be issued in connection with, or as the result of, stock splits, stock dividends
or similar transations.
3. Pursuant to Rule 457(h) and Rule 457(c) under the Securities Act of 1933, the
proposed maximum offering price per share is based on the reported average of
the high and low prices for First Albany Companies Inc. Common Stock on the
NASDAQ National Market System on May 13, 1999.
4. Estimated solely for purposes of determining the registration fee.
5. Pursuant to Rule 457(i), the registration fee is calculated solely on the
basis of the proposed offering price of the Deferred Compensation Obligations,
which may convert to First Albany Companies Inc. Common Stock at distribution.
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PART I
A prospectus setting forth the information required by Part I of Form
S-8 will be sent or given to plan participants as specified by Rule
428(b)(1)(i).
PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents which have heretofore been filed by First
Albany Companies Inc. (the "Company") (File No. 0-14140) with the Securities and
Exchange Commission (the "Commission") pursuant to the Securities Exchange Act
of 1934, as amended (the "1934 Act"), are incorporated by reference herein and
shall be deemed to be a part hereof:
1. The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1998.
2. The Company's Quarterly Report on Form 10-Q for quarter ended
March 31, 1999.
3. Description of the Company's Common Stock, par value $0.01 per
share, contained in the registration statement filed under the
1934 Act, including any amendments or reports filed for the
purpose of updating such description.
All documents filed by the Company with the Commission pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the 1934 Act prior to the filing of a
post-effective amendment to this registration statement which indicates that all
securities offered have been sold or which deregisters all securities then
remaining unsold shall be deemed to be incorporated by reference in this
registration statement and made a part hereof from their respective dates of
filing (such documents, and the documents enumerated above, being hereinafter
referred to as "Incorporated Documents"); provided, however, that the documents
enumerated above or subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the 1934 Act in each year during which the
offering made by this registration statement is in effect prior to the filing
with the Commission of the Company's Annual Report on Form 10-K covering such
year shall not be Incorporated Documents or be incorporated by reference in this
registration statement or be a part hereof from and after the filing of such
Annual Report on Form 10-K.
Any statement contained in an Incorporated Document shall be deemed to
be modified or superseded for purposes of this registration statement to the
extent that a statement contained herein or in any other subsequently filed
Incorporated Document modifies or supersedes such statement. Any such statement
so modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this registration statement.
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ITEM 4. DESCRIPTION OF SECURITIES.
The securities being registered under this registration statement
consist of (1) obligations (the "Obligations") of the Company to pay
compensation deferred by eligible employees under the terms of the First Albany
Companies Inc. Financial Consultants Deferred Compensation Plan (the "Plan") and
(2) shares of Common Stock, par value $0.01 of the Company with which certain of
the Obligations shall be paid upon distribution. A description of the Company's
Common Stock is incorporated by reference in this Registration Statement
pursuant to Item 3 above. A description of the Obligations follows.
Subject to the provisions of the Plan, an eligible employee (a
"Participant") may enter into an agreement with the Company providing for the
deferral of the payment of a specified portion or amount of compensation payable
by the Company to the Participant. A Participant's deferrals are credited to a
record keeping account maintained by the Company in the name of the Participant.
The Company may, at its discretion, credit the account of a Participant with
Company matching contributions in such amounts and at such times as may be
determined by the Company. Each Participant account will be periodically
adjusted to reflect the investment experience of one or more investment
benchmarks designated under the Plans and selected by the Participant, including
the Company's Common Stock. A Participant will become vested in the amount of
any earnings credited to his or her account, and the amount of any Company
matching contributions, in accordance with the applicable vesting schedule
established by the Company for such purposes. The vested balance credited to a
Participant account will be paid upon the earliest of (i) a pre-retirement
distribution date designated by the Participant in accordance with the
applicable Plan, (ii) termination of the Participant's employment, or (iii) the
Participant's retirement, disability or death. Payment of such vested balance
may be made in a lump sum or in up to 180 monthly installments, depending on the
applicable terms of the Plan and the Participant's payment election. Payments of
vested balances that are valued according to the Company Stock investment
benchmark shall be made in shares of Company Common Stock; all other payments
shall be made in cash. The Company reserves the right to accelerate the payment
of any Participant's vested balance in the event of a termination of the Plan.
In addition, the Company may delay the payment of a Participant's vested amounts
under certain circumstances, such as when the Participant has allocated such
amounts to a restricted investment benchmark offered under the Plan or when the
payment of such amounts would exceed certain limitations imposed by tax law. A
Participant's rights to and under the Obligations cannot be assigned, alienated,
sold, garnished, transferred, pledged or encumbered, except by way of transfer
to the employee's beneficiary or estate upon the Participant's death, pursuant
to the terms of the Plan.
The Obligations are unsecured general obligations of the Company which
rank pari passu with other unsecured and unsubordinated indebtedness of the
Company that may be outstanding from time to time. No sinking fund has or will
be established with respect to the Obligations. The Obligations are not subject
to redemption, in whole or in part, prior to the payment dates applicable under
the Plans and with the exception of the portion those Obligations that are
payable in shares of Common Stock of the Company, Obligations are not
convertible into another security of the Company. The Company reserves the right
to amend or terminate the Plans at any time, except that no such amendment or
termination shall adversely affect the rights of Participants with respect to
amounts deferred prior to such amendment or termination. In the event a Plan is
terminated, the Company may decide, in its sole discretion, to either pay the
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<PAGE> 4
Obligations as they come due in accordance with the Participants' initial
elections or accelerate the payment of the Obligations.
Except as stated above, the Obligations do not enjoy the benefit of any
affirmative or negative pledges or covenants by the Company. The Company may
establish a grantor trust to fund the payment of the Obligations, but the
Company retains discretion to determine whether such a trust will be established
and, if so, the amount and timing of any contributions to the trust. The assets
of the trust will remain subject to the claims of the Company's creditors. The
trustee of the trust will be required to administer the trust in accordance with
its terms, but the trustee's obligations and authority are limited to the
amounts which may be held in the trust from time to time and the trustee may be
subject to the direction of the Company with respect to the payment Obligations.
Accordingly, the trustee of the trust does not have any independent obligation
or authority to act on behalf of any Participant or Beneficiary and each
Participant and Beneficiary will be responsible for acting on his or her own
behalf with respect to, among other things, the giving of notices, responding to
requests for consents, waivers or amendments, enforcing covenants and taking
action upon default.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The legality of the securities offered pursuant to this registration
statement has been passed upon for the Company by Stephen P. Wink, Secretary and
General Counsel of the Company, 30 South Pearl Street, Albany, New York 12207.
Mr. Wink is the beneficial owner of shares (and options to purchase shares) of
Common Stock of the Company.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article 6.07 of the Company's By-Laws permits the indemnification of
officers and directors under certain circumstances to the full extent that such
indemnification may be permitted by law.
Such rights of indemnification are in addition to, and not in
limitation of, any rights of indemnification under the Business Corporation Law
of the State of New York (Sections 721 through 727), which provides for
indemnification by a corporation of its officers and directors under
circumstances as stated in the Business Corporation Law and subject to specified
limitations set forth in the Business Corporation Law.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
See Exhibit Index attached.
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ITEM 9. UNDERTAKINGS.
The Company hereby undertakes:
(a) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement to include any
material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such
information in the registration statement;
(b) That, for the purpose of determining any liability under the 1933
Act, each post-effective amendment to this registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof;
(c) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering; and
(d) That, for purposes of determining any liability under the 1933 Act,
each filing of the Company's annual report pursuant to Section 13(a) or Section
15(d) of the 1934 Act that is incorporated by reference in this registration
statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the 1933 Act
may be permitted to directors, officers and controlling persons of the Company
pursuant to the foregoing provisions, or otherwise, the Company has been advised
that in the opinion of the Commission such indemnification is against public
policy as expressed in the 1933 Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the
payment by the Company of expenses incurred or paid by a director, officer or
controlling person of the Company in the successful defense of any action, suit
or proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Company will, unless in the
opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the 1933 Act and
will be governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the 1933 Act, the Company certifies
that it has reasonable grounds to believe that it meets all of the requirements
for filing on Form S-8 and has duly caused this registration statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Albany, and the State of New York, on the 18th day of May, 1999.
FIRST ALBANY COMPANIES INC.
By: /s/ George C. McNamee
George C. McNamee,
Chairman of the Board
POWER OF ATTORNEY
Know all men by these presents, that each officer or director
of First Albany Companies Inc. whose signature appears below constitutes and
appoints George C. McNamee and Alan P. Goldberg, and each of them singly,
his true and lawful attorney-in-fact and agent, with full and several power
of substitution, for him and in his name, place and stead, in any and all
capacities, to sign a registration statement on Form S-8 to be filed
pursuant to the Securities Act of 1933 in connection with the registration
of up to $3,000,000.00 principle amount of Obligations and 200,000 shares of
Common Stock, par value $.01, and any or all amendments, including pre- and
post-effective amendments and supplements to this registration statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting
unto said attorney-in-fact and agent full power and authority to do and
perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorney-in-fact and agent or his substitute or substitutes, may lawfully do
or cause to be done. Each of said attorneys-in-fact shall have power to act
hereunder with or without the other.
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed below by the following persons
in the capacities indicated on the 18th day of May, 1999:
Signature Title
/s/ George C. McNamee Director, Chairman and
George C. McNamee Co-Chief Executive Officer
(Principal Executive Officer)
/s/ Alan P. Goldberg Director, President and
Alan P. Goldberg Co-Chief Executive Officer
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/s/ Timothy R. Wells Chief Financial Officer
Timothy R. Welles (Principal Financial and
Accounting Officer)
Director
Peter Barton
/s/ Walter Fiederowizc Director
Walter Fiederowicz
Director and Senior Vice
Hugh A. Johnson President
/s/ Daniel V. McNamee, III Director
Daniel V. McNamee, III
Director
Charles L. Schwager
/s/ Benaree P. Wiley Director
Benaree P. Wiley
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FIRST ALBANY COMPANIES INC.
EXHIBIT INDEX
Exhibit
Number Description
4(a) - Amended and Restated Certificate of Incorporation of First
Albany Companies Inc. (Designated in Form 10-Q filed for the
quarter ended June 26, 1998 as Exhibit 3(i)).*
4(b) - Amended and Restated Bylaws of First Albany Companies Inc.
(Designated in Form 10-Q filed for the quarter ended June 26,
1998 as Exhibit 3(ii)).*
4(c) - Speciman Certificate of Common Stock, par value $.01 per
share, (Filed as Exhibit No. 4 to Registration Statement No.
33-1353).*
4(d) - First Albany Companies Inc. Financial Consultants Deferred
Compensation Plan.
5(a) - Opinion of the Company's General Counsel as to the legality of
securities offered under the Plan.
23(a) - Consent of PricewaterhouseCoopers LLP.
23(b) - Consent of Counsel (contained in the Opinion of the Company's
General Counsel, Exhibit 5(a) hereto).
24(b) - Power of Attorney (set forth on the signature page hereof).
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* Incorporated by reference.
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EXHIBIT 4(d)
FIRST ALBANY COMPANIES INC.
FINANCIAL CONSULTANTS
DEFERRED COMPENSATION PLAN
EFFECTIVE APRIL 1, 1999
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
ARTICLE 1
<S> <C>
Definitions..............................................................................................1
ARTICLE 2
Eligibility, Selection, Enrollment.......................................................................6
2.1 Selection by Committee..........................................................................6
2.2 Enrollment Requirements.........................................................................6
2.3 Commencement of Participation...................................................................6
2.4 Subsequent Elections............................................................................7
2.5 Termination of Participation and/or Deferrals...................................................7
ARTICLE 3
Participant Deferrals, Commitments, Matching Contributions,Investment Adjustments, Taxes and Vesting.....7
3.1 Participant Deferrals...........................................................................7
(a) Deferral Election......................................................................7
(b) Minimum Deferral.......................................................................8
(i) Minimum..................................................................8
(ii) Short Plan Year.........................................................8
(c) Maximum Deferral.......................................................................8
(d) Deferral Designations..................................................................9
(i) Base Annual Salary.......................................................9
(ii) Bonus Amounts...........................................................9
(iii) Commissions............................................................9
3.2 Annual Matching Contribution....................................................................9
3.3 Selection of Investment Benchmarks..............................................................9
3.4 Adjustment of Plan Accounts....................................................................10
3.5 FICA and Other Taxes...........................................................................10
(a) Annual Deferral Amounts...............................................................10
(b) Distributions.........................................................................10
3.6 Vesting........................................................................................11
(a) Forfeiture of Unvested Amounts........................................................11
(b) Vesting of Amounts....................................................................11
(c) Vesting After Covered Termination.....................................................11
(d) Vesting Upon Plan Termination.........................................................11
(e) Acceleration of Vesting by Committee..................................................11
</TABLE>
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<TABLE>
ARTICLE 4
<S> <C>
Suspension of Deferrals.................................................................................12
4.1 Unforeseeable Financial Emergencies............................................................12
4.2 Disability.....................................................................................12
4.3 Resumption of Deferrals........................................................................12
ARTICLE 5
Distribution of Plan Accounts...........................................................................12
5.1 Elective Distribution of Specified Plan Accounts...............................................12
5.2 Non-Elective Distribution of Aggregate Vested Balance..........................................13
5.3 Withdrawal in the Event of an Unforeseeable Financial Emergency................................13
5.4 Distribution Restrictions......................................................................13
5.5 Valuation of Plan Accounts Pending Distribution................................................13
5.6 Form of Payment................................................................................13
ARTICLE 6
Termination Benefit.....................................................................................14
6.1 Termination Benefit............................................................................14
6.2 Payment of Termination Benefit.................................................................14
6.3 Death Prior to Completion of Termination Benefit...............................................14
ARTICLE 7
Retirement Benefit......................................................................................14
7.1 Retirement Benefit.............................................................................14
7.2 Payment of Retirement Benefit..................................................................14
7.3 Death Prior to Completion of Retirement Benefit................................................15
ARTICLE 8
Pre-Retirement Survivor Benefit.........................................................................15
8.1 Pre-Retirement Survivor Benefit................................................................15
8.2 Payment of Pre-Retirement Survivor Benefit.....................................................15
ARTICLE 9
Disability Benefit......................................................................................16
9.1 Disability Benefit.............................................................................16
</TABLE>
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<TABLE>
ARTICLE 10
<S> <C>
Beneficiary Designation.................................................................................16
10.1 Beneficiary....................................................................................16
10.2 Beneficiary Designation; Change; Spousal Consent...............................................16
10.3 Acknowledgment.................................................................................17
10.4 No Beneficiary Designation.....................................................................17
10.5 Doubt as to Beneficiary........................................................................17
10.6 Discharge of Obligations.......................................................................17
ARTICLE 11
Leave of Absence........................................................................................17
11.1 Paid Leave of Absence..........................................................................17
11.2 Unpaid Leave of Absence........................................................................17
ARTICLE 12
Termination, Amendment or Modification..................................................................18
12.1 Termination....................................................................................18
12.2 Amendment......................................................................................18
12.3 Effect of Payment..............................................................................18
ARTICLE 13
Administration..........................................................................................18
13.1 Committee Duties...............................................................................18
13.2 Agents.........................................................................................19
13.3 Binding Effect of Decisions....................................................................19
13.4 Indemnity of Committee.........................................................................19
13.5 Employer Information...........................................................................19
ARTICLE 14
Other Benefits and Agreements...........................................................................19
ARTICLE 15
Claims Procedures.......................................................................................20
15.1 Presentation of Claim..........................................................................20
15.2 Notification of Decision.......................................................................20
15.3 Review of a Denied Claim.......................................................................20
15.4 Decision on Review.............................................................................21
</TABLE>
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<TABLE>
<S> <C>
15.5 Arbitration....................................................................................21
ARTICLE 16
Trust...................................................................................................21
16.1 Establishment of the Trust.....................................................................21
16.2 Interrelationship of the Plan and the Trust....................................................21
16.3 Distributions From the Trust...................................................................21
ARTICLE 17
Miscellaneous...........................................................................................22
17.1 Status of Plan.................................................................................22
17.2 Unsecured General Creditor.....................................................................22
17.3 Employer's Liability...........................................................................22
17.4 Nonassignability...............................................................................22
17.5 Not a Contract of Employment...................................................................22
17.6 Furnishing Information.........................................................................23
17.7 Terms..........................................................................................23
17.8 Captions.......................................................................................23
17.9 Governing Law..................................................................................23
17.10 Notice.........................................................................................23
17.11 Successors.....................................................................................23
17.12 Spouse's Interest..............................................................................23
17.13 Validity.......................................................................................24
17.14 Incompetent....................................................................................24
17.15 Distribution in the Event of Taxation..........................................................24
17.16 Insurance......................................................................................24
17.17 Legal Fees To Enforce Rights After Change in Control...........................................24
</TABLE>
iv
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FIRST ALBANY COMPANIES INC.
FINANCIAL CONSULTANTS
DEFERRED COMPENSATION PLAN
Effective April 1, 1999
PURPOSE
The purpose of this Plan is to provide specified benefits to a
select group of highly compensated Employees who contribute materially to the
continued growth, development and future business success of First Albany
Companies Inc. and its subsidiaries, if any, that sponsor this Plan. This Plan
shall be unfunded for tax purposes and for purposes of Title I of ERISA.
ARTICLE 1
Definitions
For purposes of this Plan, unless otherwise clearly apparent
from the context, the following phrases or terms shall have the meanings
indicated:
1.1 "Aggregate Vested Balance" or "Aggregate Vested Benefit" shall mean,
with respect to the Plan Accounts of any Participant as of a given
date, the sum of the amounts that have become vested under all of the
Participant's Plan Accounts, as adjusted to reflect all applicable
Investment Adjustments and all prior withdrawals and distributions,
in accordance with Article 3 of the Plan and the provisions of the
applicable Enrollment Forms.
1.2 "Amended Election Form" shall mean the Amended Election Form required
by the Committee to be signed and submitted by a Participant to
effect a permitted change in the elections previously made by the
Participant under any Annual Election Form.
1.3 "Annual Deferral Account" shall mean a Participant's Annual
Participant Deferral for a Plan Year, as adjusted to reflect all
applicable Investment Adjustments and all prior distributions and
withdrawals.
1.4 "Annual Deferral Agreement" shall mean the Annual Deferral Agreement
required by the Committee to be signed and submitted by a Participant
in connection with the Participant's deferral election with respect
to a given Plan Year.
1.5 "Annual Election Form" shall mean the Annual Election Form required
by the Committee to be signed and submitted by a Participant in
connection with the Participant's deferral election with respect to a
given Plan Year.
1.6 "Annual Matching Contribution" shall mean the aggregate amount
credited by the Company to a Participant in respect of a particular
Plan Year under Section 3.2.
<PAGE> 7
1.7 "Annual Matching Contribution Account" shall mean a Participant's
Annual Matching Contributions for a Plan Year, as adjusted to reflect
all applicable Investment Adjustments and all prior distributions and
withdrawals.
1.8 "Annual Participant Deferral" shall mean the aggregate amount
deferred by a Participant in respect of a particular Plan Year under
Section 3.1.
1.9 "Base Annual Salary" shall mean the annual base salary payable to a
Participant by an Employer in cash in respect of services rendered
during a Plan Year, including any Elective Deductions, but excluding
Bonus Amounts, Commissions or other additional incentives or awards
payable to the Participant.
1.10 "Beneficiary" shall mean one or more persons, trusts, estates or
other entities, designated in accordance with Article 10, that are
entitled to receive a Participant's Aggregate Account Balance under
this Plan in the event of the Participant's death.
1.11 "Board" shall mean the board of directors of the Company.
1.12 "Bonus Amounts" shall mean the amounts payable to a Participant in
cash by an Employer in respect of services rendered during a Plan
Year under any bonus or incentive plan or arrangement of an Employer,
including any Elective Deductions, but excluding Commissions,
stock-related awards and other non-monetary incentives.
1.13 "Change in Control" shall mean the earliest to occur of the following
events:
(a) The consummation of any transaction or series of transactions
as a result of which any "Person" (as the term person is used
for purposes of Section 13(d) or 14(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) other
than an "Excluded Person" (as hereinafter defined) has or
obtains ownership or control, directly or indirectly, of fifty
percent (50%) or more of the combined voting power of all
securities of the Company or any successor or surviving
corporation of any merger, consolidation or reorganization
involving the Company (the "Voting Securities"). The term
"Excluded Person" means any one or more of the following: (i)
the Company or any majority-owned subsidiary of the Company,
(ii) an employee benefit plan (or a trust forming a part
thereof) maintained by (A) the Company or (B) any
majority-owned subsidiary of the Company, (iii) any Person who
as of the initial effective date of this Plan owned or
controlled, directly or indirectly, ten percent (10%) or more
of the then outstanding Voting Securities, or any individual,
entity or group that was part of such a Person;
(b) A merger, consolidation or reorganization involving the
Company as a result of which the holders of Voting Securities
immediately before such merger, consolidation or
reorganization do not immediately following such merger,
consolidation or reorganization own or control, directly or
indirectly, at least fifty percent (50%) of the Voting
Securities in substantially the same proportion as their
ownership or control of the Voting Securities immediately
before such merger, consolidation or reorganization; or
2
<PAGE> 8
(c) The sale or other disposition of all or substantially all of
the assets of the Company to any Person (other than a transfer
to a majority-owned subsidiary of the Company).
1.14 "Claimant" shall have the meaning set forth in Section 15.1.
1.15 "Code" shall mean the Internal Revenue Code of 1986, as it may be
amended from time to time.
1.16 "Commissions" shall mean the amounts payable to a Participant by an
Employer in cash in respect of services rendered during a Plan Year
under any commission scheme or commission draw arrangement, including
any Elective Deductions, but excluding Bonus Amounts, stock-related
awards and other non-monetary incentives.
1.17 "Committee" shall mean the committee described in Article 13.
1.18 "Company" shall mean First Albany Companies Inc., a New York
corporation, and any successor to all or substantially all of its
assets or business.
1.19 "Company Stock" shall mean the common stock, par value $.01 per
share, of the Company.
1.20 "Covered Termination" shall mean the termination of a Participant's
employment with the Company and all other Employers within two (2)
years following a Change in Control as a result of the Participant's
resignation for good reason or a termination by the Participant's
Employer without cause. For these purposes a Participant's
resignation for good reason shall mean a Participant's resignation
following (i) a diminution in the Participant's status, title,
position or responsibilities, or an assignment to the Participant of
duties inconsistent with the Participant's status, title or position
other than for cause or (ii) a material reduction in the
Participant's aggregate annualized compensation rate solely as a
result of a change adopted unilaterally by the Company. A
Participant's resignation shall not be treated as a resignation for
good reason unless it occurs after one of the foregoing events and
the Participant provides the Employer with written notice of the
event within six (6) months of the occurrence of the event and within
seven (7) days before the effective date of the Participant's
resignation and the Employer shall not have cured such event prior to
such resignation. A termination by the Participant's Employer without
cause shall mean an involuntary termination of the Participant's
employment by Participant's Employer other than by reason of the
Participant's (i) willful and continued failure to perform the duties
of his or her position after receiving notice of such failure and
being given reasonable opportunity to cure such failure; (ii) willful
misconduct which is demonstrably and materially injurious to the
Employer; (iii) conviction of a felony; or (iv) material breach of
applicable federal or state securities laws, regulations or licensing
requirements or the applicable rules or regulations of any
self-regulatory body. No act or failure to act on the part of a
Participant shall be considered "willful" unless it is done or
omitted to be done in bad faith or without reasonable belief that the
action or omission was in the best interest of the Employer. No
termination shall be considered a termination for cause unless it is
3
<PAGE> 9
effected by a written notice to the Participant stating in detail the
grounds constituting cause.
1.21 "Disability" shall mean a period of disability during which a
Participant qualifies for total permanent disability benefits under
the Participant's Employer's long-term disability plan, or, if a
Participant does not participate in such a plan, a period of
disability during which the Participant would have qualified for
total permanent disability benefits under such a plan had the
Participant been a participant in such a plan, as determined in the
sole discretion of the Committee. If the Participant's Employer does
not sponsor such a plan, or discontinues to sponsor such a plan,
Disability shall be determined by the Committee in its sole
discretion.
1.22 "Disability Benefit" shall mean the benefit set forth in Article 9.
1.23 "Election Form" shall mean, with respect to any Plan Account, the
Annual Election Form or the Amended Election Form last signed and
submitted by the Participant and accepted by the Committee with
respect to that Plan Account.
1.24 "Elective Deductions" shall mean deductions made from a Participant's
Base Annual Salary, Bonus Amounts and Commissions for amounts
voluntarily deferred or contributed by the Participant pursuant to
all qualified and non-qualified compensation deferral plans,
including, without limitation, amounts not included in the
Participant's gross income under Code Sections 125, 402(e)(3) and
402(h), provided, however, that all such amounts would have been
payable in cash to the Employee had there been no such plan.
1.25 "Employee" shall mean a person who is an employee of any Employer.
1.26 "Employer" shall mean the Company and/or any of its subsidiaries (now
in existence or hereafter formed or acquired) that have been selected
by the Board to participate in the Plan and have adopted the Plan as
a sponsor.
1.27 "Enrollment Forms" shall mean, for any Plan Year, the Annual Deferral
Agreement, the Annual Election Form and any other forms or documents
which may be required of a Participant by the Committee, in its sole
discretion.
1.28 "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as it may be amended from time to time.
1.29 "Investment Adjustment" shall mean an adjustment made to the balance
of any Plan Account in accordance with Section 3.4 to reflect the
performance of an Investment Benchmark pursuant to which the value of
the Plan Account is measured.
1.30 "Investment Benchmark" shall mean a benchmark made available under
the Plan from time to time by the Committee for purposes of valuing
Plan Accounts.
1.31 "Participant" shall mean any Employee (i) who is selected to
participate in the Plan, (ii) who elects to participate in the Plan,
(iii) who signs the applicable Enrollment Forms
4
<PAGE> 10
and Benefit Election and Beneficiary Designation Form (and other
forms required by the Committee), (iv) whose signed Enrollment Forms
and Benefit Election and Beneficiary Designation Form (and other
required forms) are accepted by the Committee, (v) who commences
participation in the Plan, and (vi) whose participation has not
terminated. A spouse or former spouse of a Participant shall not be
treated as a Participant in the Plan or have an account balance under
the Plan, even if he or she has an interest in the Participant's
benefits under the Plan as a result of applicable law or property
settlements resulting from legal separation or divorce.
1.32 "Plan" shall mean the First Albany Companies Inc. Investment
Executives Deferred Compensation Plan, which shall be evidenced by
this instrument and by each Enrollment Form, as they may be amended
from time to time.
1.33 "Plan Accounts" shall mean the Annual Deferral Accounts and Annual
Matching Accounts established under the Plan.
1.34 "Plan Year" shall mean the period beginning on January 1 of each year
and ending December 31.
1.35 "Pre-Retirement Distribution Election" shall mean an election made in
accordance with Section 5.1.
1.36 "Pre-Retirement Survivor Benefit" shall mean the benefit set forth in
Article 8.
1.37 "Restricted Investment Benchmark" means an Investment Benchmark which
is designated as a Restricted Investment Benchmark by the Committee
at the time such Investment Benchmark is initially made available
under the Plan.
1.38 "Retirement," "Retires" or "Retired" shall mean, with respect to an
Employee, severance from employment from all Employers (and all other
affiliates of the Company) for any reason other than an authorized
leave of absence, Disability, death or for cause on or after the
earlier of the attainment of age sixty-five (65) with ten (10) Years
of Service.
1.39 "Retirement Benefit" shall mean the benefit set forth in Article 7.
1.40 "Retirement Benefit and Beneficiary Designation Form" shall mean the
Retirement Benefit and Beneficiary Designation Form or Amended
Retirement Benefit and Beneficiary Designation Form last signed and
submitted by a Participant and accepted by the Committee.
1.41 "Termination Benefit" shall mean the benefit set forth in Article 6.
1.42 "Termination of Employment" shall mean the severing of employment
with all Employers, voluntarily or involuntarily, for any reason
other than Retirement, Disability, death, an authorized leave of
absence or for cause.
1.43 "Trust" shall mean the trust established in accordance with Article
16.
5
<PAGE> 11
1.44 "Unforeseeable Financial Emergency" shall mean an unanticipated
emergency that is caused by an event beyond the control of the
Participant that would result in severe financial hardship to the
Participant resulting from (i) a sudden and unexpected illness or
accident of the Participant or a dependent of the Participant, (ii) a
loss of the Participant's property due to casualty, or (iii) such
other extraordinary and unforeseeable circumstances arising as a
result of events beyond the control of the Participant, all as
determined in the sole discretion of the Committee. In making its
determination the Committee shall be guided by the prevailing
authorities applicable under the Code.
1.45 "Vested Account Balance" shall mean, with respect to any Plan Account
as of a given date, the sum of the amounts that have become vested,
as adjusted to reflect all applicable Investment Adjustments and all
prior withdrawals and distributions, in accordance with Article 3 of
the Plan and the provisions of applicable Enrollment Forms.
1.46 "Years of Service" shall mean the total number of full Plan Years
during which a Participant has been continuously employed by one or
more Employers. Any partial Plan Year during which a Participant has
been employed by an Employer shall not be counted.
ARTICLE 2
Eligibility, Selection, Enrollment
2.1 Selection by Committee. Participation in the Plan shall be
limited to a select group of highly compensated Employees of the
Employers, as determined by the Committee in its sole discretion.
From that group, the Committee shall select, in its sole discretion,
the Employees who shall be eligible to make an Annual Participant
Deferral in respect of each Plan Year. The Committee's selection of
an Employee to make an Annual Participant Deferral in respect of a
particular Plan Year will not entitle that Employee to make an Annual
Participant Deferral for any subsequent Plan Year, unless the
Employee is again selected by the Committee to make an Annual
Participant Deferral for such subsequent Plan Year.
2.2 Enrollment Requirements. As a condition to being eligible to make
an Annual Participant Deferral for any Plan Year, each selected
Employee shall complete, execute and return to the Committee each of
the required Enrollment Forms, and shall have on file with the
Committee a completed Retirement Benefit and Beneficiary Designation
Form, all prior to the date specified by the Committee. In addition,
the Committee shall establish from time to time such other enrollment
requirements as it determines necessary, in its sole discretion.
2.3 Commencement of Participation. Provided an Employee selected to
make an Annual Participant Deferral in respect of a particular Plan
Year has met all enrollment requirements set forth in this Plan and
required by the Committee, including returning
6
<PAGE> 12
all required documents to the Committee within the specified time
period, the Employee's designated deferrals shall commence as of the
date established by the Committee in its sole discretion. If an
Employee fails to meet all such requirements within the specified
time period with respect to any Plan Year, the Employee shall not be
eligible to make any deferrals for that Plan Year.
2.4 Subsequent Elections. The Enrollment Forms submitted by a
Participant in respect of a particular Plan Year will not be
effective with respect to any subsequent Plan Year. If an Employee is
selected to participate in the Plan for a subsequent Plan Year and
the required Enrollment Forms are not timely delivered for the
subsequent Plan Year, the Participant shall not be eligible to make
any deferrals with respect to such subsequent Plan Year.
2.5 Termination of Participation and/or Deferrals. If the Committee
determines in good faith that a Participant no longer qualifies as a
member of a select group of highly compensated employees, as
membership in such group is determined in accordance with Sections
201(2), 301(a)(3) and 401(a)(1) of ERISA, the Committee shall have
the right, in its sole discretion, to (i) terminate any Annual
Participant Deferral and Annual Matching Contribution not yet
credited to the Participant's Plan Accounts and/or (ii) immediately
distribute the Participant's then Aggregate Vested Balance as a
Termination Benefit and terminate the Participant's participation in
the Plan. Any Annual Matching Contribution made on behalf of the
Participant that is not vested prior to the date of the Committee's
determination shall be forfeited by the Participant. If the Committee
chooses to terminate the Participant's participation in the Plan, the
Committee may, in its sole discretion, select the Participant to
participate in the Plan at such time in the future as the Participant
again becomes a member of the select group described above. If a
Participant's Employer terminates the Participant's employment for
cause (as described in Section 1.19), then, (i) the Participant's
participation in the Plan shall automatically terminate, (ii) the
Committee shall distribute to the Participant, at the time and in the
manner described in Section 6.2, the remainder of the Participant's
Annual Participant Deferrals that were credited to the Participant's
Plan Accounts prior to the date of termination after adjustment for
all prior withdrawals and distributions and (iii) all other amounts
in any of the Participant's Plan Accounts shall be forfeited by the
Participant. Any distribution made pursuant to this Section 2.5 may
be subject to deferred distribution pursuant to Section 5.4.
ARTICLE 3
Participant Deferrals, Commitments, Matching Contributions,
Investment Adjustments, Taxes and Vesting
3.1 Participant Deferrals.
(a) Deferral Election. A Participant may make an
election to defer the receipt of amounts payable to the
Participant in the form of Base Annual Salary, Bonus Amounts
and Commissions for services rendered during a Plan Year. The
Participant's election shall be evidenced by an Annual
Deferral Agreement and
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<PAGE> 13
Annual Election Form completed and submitted to the Committee
in accordance with such procedures and time frames as may be
established by the Committee in its sole discretion. Amounts
deferred by a Participant in respect of services rendered
during a Plan Year shall be referred to collectively as an
Annual Participant Deferral and shall be credited to an
Annual Deferral Account established in the name of the
Participant. A separate Annual Deferral Account shall be
established and maintained for each Annual Participant
Deferral. The Committee shall have sole discretion to
determine in respect of each Plan Year: (i) whether a
Participant shall be eligible to make an Annual Participant
Deferral; (ii) the form(s) of compensation which may be the
subject of any Annual Participant Deferral; and (iii) any
other terms and conditions applicable to the Annual
Participant Deferral.
(b) Minimum Deferral.
(i) Minimum. For each Plan Year the Committee may permit
a Participant to elect to defer, as his or her Annual
Participant Deferral, one or more of the following
forms of compensation in the following minimum
amounts:
<TABLE>
<CAPTION>
Minimum
Deferral Amount
-------- -------
<S> <C>
Base Annual Salary $3,000
Bonus Amounts $3,000
Commissions $3,000
</TABLE>
If an election is made for less than stated minimum
amounts, or if no election is made, the amount
deferred shall be zero.
(ii) Short Plan Year. If a Participant first becomes a
Participant after the first day of a Plan Year, the
minimum deferral of each of the Participant's Base
Annual Salary, Bonus Amounts and Commissions shall be
an amount equal to the minimum set forth above,
multiplied by a fraction, the numerator of which is
the number of complete months remaining in the Plan
Year and the denominator of which is 12.
(c) Maximum Deferral. For each Plan Year the
Committee may permit a Participant to elect to defer, as his
or her Annual Participant Deferral, one or more of the
following forms of compensation payable to the Participant,
but not yet received, during the Plan Year up to the
following maximum percentages:
<TABLE>
<CAPTION>
Maximum
Deferral Percentage
-------- ----------
<S> <C>
Base Annual Salary 50%
Bonus Amounts 100%
Commissions 100%
</TABLE>
8
<PAGE> 14
(d) Deferral Designations.
(i) Base Annual Salary. A Participant may designate the
amount of the Annual Participant Deferral to be
deducted from his or her Base Annual Salary as either
a percentage of his or her Base Annual Salary or a
fixed dollar amount. Such amount shall be withheld
from each regularly scheduled Base Annual Salary
payment in equal amounts.
(ii) Bonus Amounts. A Participant may designate the amount
of the Annual Participant Deferral to be deducted
from his or her Bonus Amounts as either a percentage
or a fixed dollar amount of specified Bonus Amounts
expected by the Participant. Percentages may be
expressed as percentages of Bonus Amounts in excess
of stated thresholds selected by the Participant. If
a Participant designates the Annual Participant
Deferral to be deducted from any Bonus Amount as a
fixed dollar amount and such fixed dollar amount
exceeds the Bonus Amount actually payable to the
Participant, the entire amount of such Bonus Amount
shall be withheld.
(iii) Commissions. A Participant may designate the amount
of the Annual Participant Deferral to be deducted
from his or her Commissions as either a percentage of
his or her Commissions or a fixed dollar amount.
Percentages may be expressed as percentages of the
amount of each regularly scheduled Commission payment
in excess of a stated threshold selected by the
Participant. Such amount shall be withheld from the
Commission portion of each regularly scheduled
Commission payment in equal amounts.
3.2 Annual Matching Contribution. A Participant may be credited with
one or more matching contributions in respect of any Plan Year,
expressed as a percentage of the amount of Base Annual Salary, Bonus
Amounts, Commissions or any combination of the foregoing deferred by
the Participant pursuant to the Participant's Annual Participant
Deferral for the Plan Year. Such matching contributions credited to a
Participant in respect of a Plan Year shall be referred to
collectively as the Annual Matching Contribution for that Plan Year
and shall be credited to an Annual Matching Contribution Account in
the name of the Participant. A separate Annual Matching Contribution
Account shall be established and maintained for each Annual Matching
Contribution. The Board shall have sole discretion to determine in
respect of each Plan Year and each Participant: (i) whether any
Annual Matching Contribution shall be made; (ii) the Participant(s)
who shall be entitled to such Annual Matching Contribution; (iii) the
amount of such Annual Matching Contribution; (iv) the date(s) on
which any portion of such Annual Matching Contribution shall be
credited to each Participant's Annual Matching Contribution Account;
and (v) any other terms and conditions applicable to such Annual
Matching Contribution.
3.3 Selection of Investment Benchmarks. In connection with a
Participant's election to make an Annual Participant Deferral in
respect of a Plan Year, the Participant shall select one or more
Investment Benchmarks and the percentage of the Participant's
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<PAGE> 15
Annual Deferral Account and Annual Matching Contribution Account (if
any) for such Plan Year to be adjusted to reflect the performance of
each selected Investment Benchmark. All selections of Investment
Benchmarks shall be in multiples of 10% unless the Committee
determines that lower increments are acceptable. A Participant may
make changes in his or her selected Investment Benchmarks with
respect to any Plan Account at such times as the Committee may
designate by completing and submitting to the Committee an Amended
Election Form in accordance with such procedures and time frames as
may be established from time to time at the sole discretion of the
Committee, provided, however, that the Committee, in its sole
discretion, may limit a Participant's ability to make such changes
with respect to certain Investment Benchmarks.
3.4 Adjustment of Plan Accounts. While a Participant's Plan Accounts
do not represent the Participant's ownership of, or any ownership
interest in, any particular assets, the Participant's Plan Accounts
shall be adjusted in accordance with the Investment Benchmark(s),
subject to the conditions and procedures set forth herein or
established by the Committee from time to time. Any cash earnings
generated under an Investment Benchmark (such as interest and cash
dividends and distributions) shall, at the Committee's sole
discretion, either be deemed to be reinvested in that Investment
Benchmark or reinvested in one or more other Investment Benchmark(s)
designated by the Committee. All notional acquisitions and
dispositions of Investment Benchmarks under a Participant's Plan
Accounts shall be deemed to occur at such times as the Committee
shall determine to be administratively feasible in its sole
discretion and the Participant's Plan Accounts shall be adjusted
accordingly. In addition, a Participant's Plan Accounts may be
adjusted from time to time, in accordance with procedures and
practices established by the Committee, in its sole discretion, to
reflect any notional transactional costs and other fees and expenses
relating to the deemed investment, disposition or carrying of any
Investment Benchmark for the Participant's Plan Accounts. Adjustments
made in accordance herewith shall be referred to as Investment
Adjustments. Notwithstanding anything to the contrary, any Investment
Adjustments made to any Plan Account following a Change in Control
shall be made in a manner no less favorable to Participants than the
practices and procedures employed under the Plan, or as otherwise in
effect, as of the date of the Change in Control.
3.5 FICA and Other Taxes.
(a) Annual Deferral Amounts. For each Plan Year
in which an Annual Participant Deferral is being withheld
from a Participant, the Participant's Employer(s) shall
withhold from that portion of the Participant's Base Annual
Salary, Bonus Amounts, and/or Commissions that is not being
deferred, in a manner determined by the Employer(s), the
Participant's share of FICA and other employment taxes,
provided, however, that the Committee may reduce the Annual
Participant Deferral if necessary to comply with applicable
withholding requirements.
(b) Distributions. The Participant's Employer(s),
or the trustee of the Trust, shall withhold from any payments
made to a Participant under this Plan all
10
<PAGE> 16
federal, state and local income, employment and other taxes
required to be withheld by the Employer(s), or the trustee
of the Trust, in connection with such payments, in amounts
and in a manner to be determined in the sole discretion of
the Employer(s) and the trustee of the Trust.
3.6 Vesting.
(a) Forfeiture of Unvested Amounts. As of the date of
a Participant's Termination of Employment, Retirement,
Disability or death, the amounts credited to each of the
Participant's Plan Accounts shall be reduced by the amount
which has not become vested in accordance with the vesting
provisions set forth below and in the Annual Deferral
Agreement applicable to such Plan Account, and such unvested
amounts shall be forfeited by the Participant.
(b) Vesting of Amounts. The Participant shall be
vested in the amounts credited to his or her Annual Deferral
Account and Annual Matching Contribution Account in respect of
each given Plan Year as set forth in the Annual Deferral
Agreement pertaining to such Plan Year. The vesting terms set
forth in each Annual Deferral Agreement shall be established
by the Committee in its sole discretion and may vary for each
Participant and each Plan Year. Such vesting terms may, in the
Committee's discretion, provide for acceleration of vesting
upon a Change in Control.
(c) Vesting After Covered Termination. Unless
otherwise specifically provided under the terms of a
particular Annual Deferral Agreement, in the event of a
Participant's Covered Termination, such Participant, as of the
effective date of such Covered Termination, shall be 100%
vested in all amounts credited to each of the Participant's
Plan Accounts, as adjusted for the applicable Investment
Adjustments and all prior withdrawals and distributions.
(d) Vesting Upon Plan Termination. In the event of a
termination of the Plan as it relates to any Participant, all
amounts credited to any and all Plan Accounts of such
Participant as of the effective date of such termination shall
be 100% vested.
(e) Acceleration of Vesting by Committee.
Notwithstanding anything to the contrary contained in the Plan
or any Annual Deferral Agreement, the Committee shall have the
authority, exercisable in its sole discretion, to accelerate
the vesting of any amounts credited to any Plan Account of any
Participant and any such acceleration shall be evidenced by a
written notice to the Participant setting forth in detail the
Plan Account(s) and the amounts affected by the Committee's
decision to accelerate vesting and the terms of the new
vesting schedule applicable to such amounts.
11
<PAGE> 17
ARTICLE 4
Suspension of Deferrals
4.1 Unforeseeable Financial Emergencies. If a Participant experiences
an Unforeseeable Financial Emergency, the Participant may petition
the Committee to suspend any deferrals required to be made by the
Participant. The Committee shall determine, in its sole discretion,
whether to approve the Participant's petition. If the petition for a
suspension is approved, suspension shall take effect upon the date of
approval.
4.2 Disability. From and after the date that a Participant is deemed
have suffered a Disability, any standing deferral election of the
Participant shall automatically be suspended and no further deferrals
shall be made with respect to the Participant.
4.3 Resumption of Deferrals. If deferrals by a Participant have been
suspended during a Plan Year due to an Unforeseen Financial Emergency
or a Disability, the Participant will not be eligible to make any
further deferrals in respect of that Plan Year. The Participant may
be eligible to make deferrals for subsequent Plan Years provided the
Participant is selected to make deferrals for such subsequent Plan
Years and the Participant complies with the election requirements
under the Plan.
ARTICLE 5
Distribution of Plan Accounts
5.1 Elective Distribution of Specified Plan Accounts. A Participant
may elect, at the time he or she makes an Annual Deferral Election
with respect to a given Plan Year, to have the Vested Account Balance
of the Participant's Annual Deferral Account and Annual Matching
Contribution Account (if any) for that Plan Year distributed in a
lump sum as of January 15 of the tenth (10th) Plan Year following the
end of the Plan Year in respect of which the Annual Deferral Election
was made (a "Pre-Retirement Distribution Election"). The Participant
may revoke his or her Pre-Retirement Distribution Election with
respect to any Plan Account at such times as the Committee may
designate by completing and submitting to the Committee an Amended
Election Form setting forth such revocation in accordance with such
procedures and time frames as may be established from time to time at
the sole discretion of the Committee, provided that such Amended
Election Form is submitted prior to the commencement of the calendar
year in which the Vested Account Balance of such Plan Account would
otherwise be distributed and at least three (3) months prior to the
date that the distribution was otherwise scheduled to occur, and such
Amended Election Form is accepted by the Committee in its sole
discretion. Notwithstanding a Participant's Pre-Retirement
Distribution Election with respect to the Vested Account Balance of
any Plan Account, some or all of such Vested Account Balance may be
subject to earlier distribution pursuant to Section 5.2 or deferred
distribution pursuant to Section 5.4.
12
<PAGE> 18
5.2 Non-Elective Distribution of Aggregate Vested Balance.
Notwithstanding any Pre-Retirement Distribution Election,
distribution of a Participant's Aggregate Vested Balance shall be
made upon the earliest of the Participant's (i) Termination of
Employment, (ii) Retirement, (iii) Disability, or (iv) death, in each
case subject to and in accordance with the applicable provisions of
Articles 6 through 9, provided, however, that the distribution of
some or all of a Participant's Aggregate Vested Balance is subject to
the provisions of Section 5.4.
5.3 Withdrawal in the Event of an Unforeseeable Financial Emergency.
Subject to Section 5.4, in the event that a Participant or (after a
Participant's death) a Participant's Beneficiary experiences an
Unforeseeable Financial Emergency, the Participant or Beneficiary may
petition the Committee to receive a partial or full payout of amounts
credited to one or more of the Participant's Plan Accounts. The
Committee shall determine, in its sole discretion, whether the
requested payout shall be made, the amount of the payout and the Plan
Accounts from which the payout will be made; provided, however, that
the payout shall not exceed the lesser of the Participant's Aggregate
Vested Benefit or the amount reasonably needed to satisfy the
Unforeseeable Financial Emergency. In making any determinations under
this Section 5.3, the Committee shall be guided by the prevailing
authorities under the Code. If, subject to the sole discretion of the
Committee, the petition for a payout is approved, the payout shall be
made within 60 days of the date of approval.
5.4 Distribution Restrictions. Notwithstanding anything to the
contrary contained in this Plan or in any Enrollment Form, Benefit
Election and Beneficiary Designation Form or any other document, the
Committee may impose limitations and restrictions on the payment of
amounts allocated by a Participant to any Restricted Investment
Benchmark(s) and may defer payment of those amounts for such time
periods as the Committee determines, in its good faith judgement, to
be consistent with the nature of the investment on which such
Restricted Investment Benchmark is based. The Committee shall
determine the amounts affected, the nature of the limitations and
restrictions on benefit payments, and the length of deferral and time
of payment of such amounts. In addition, distributions under the Plan
shall be subject to any constraints or restrictions imposed under any
ancillary agreement, including but not limited to any New York Stock
Exchange Subordination Agreement, to which a Participant becomes a
party in conjunction with, or as a condition to, participation in the
Plan. Any such ancillary agreement shall be incorporated into and
become a part of the Plan.
5.5 Valuation of Plan Accounts Pending Distribution. To the extent
that the distribution of any portion of any Plan Account is deferred,
whether pursuant to the limitations imposed under this Article 5 or
pursuant to any installment payment schedule under Articles 6 and 9
or for any other reason, any amounts remaining to the credit of the
Plan Account shall continue to be adjusted by the applicable
Investment Adjustments in accordance with Article 3.
5.6 Form of Payment. Distributions under the Plan shall be paid in
cash; except, however, that the Committee may provide, in its
discretion, that any distribution attributable to the portion of a
Plan Account that is deemed invested in an Investment
13
<PAGE> 19
Benchmark that tracks that value of Company Stock shall be paid in
shares of Company Stock.
ARTICLE 6
Termination Benefit
6.1 Termination Benefit. Subject to Article 5, a Participant shall
receive a Termination Benefit, which shall be equal to the
Participant's Aggregate Vested Balance if a Participant experiences a
Termination of Employment prior to his or her Retirement, Disability,
or death.
6.2 Payment of Termination Benefit. If the Participant's Aggregate
Vested Balance at the time of his or her Termination of Employment is
less than $25,000, payment of his or her Termination Benefit shall be
paid in a lump sum. If his or her Aggregate Vested Balance at such
time is equal to or greater than that amount, the Committee, in its
sole discretion, may cause the Termination Benefit to be paid in a
lump sum or in substantially equal monthly installment payments over
a period of time that does not exceed five (5) years in duration.
Subject to Article 5, the lump sum payment shall be made, or
installment payments shall commence, no later than 60 days after the
date of the Participant's Termination of Employment.
6.3 Death Prior to Completion of Termination Benefit. If a
Participant dies after a Termination of Employment but before the
Termination Benefit is paid in full, the Participant's unpaid
Termination Benefit payments shall continue and shall be paid to the
Participant's Beneficiary (a) over the remaining number of months and
in the same amounts as that benefit would have been paid to the
Participant had the Participant survived, or (b) subject to Article
5, in a lump sum, if requested by the Beneficiary and allowed in the
sole discretion of the Committee, that is equal to the Participant's
unpaid remaining Aggregate Vested Balance.
ARTICLE 7
Retirement Benefit
7.1 Retirement Benefit. Subject to Article 5, a Participant who
Retires shall receive, as a Retirement Benefit, his or her Aggregate
Vested Balance.
7.2 Payment of Retirement Benefit. A Participant, in connection with
his or her commencement of participation in the Plan, shall elect on
a Benefit Election and Beneficiary Designation Form to receive the
Retirement Benefit in a lump sum or in substantially equal monthly
payments over a period of 36, 60, 120 or 180 months. The Participant
may change his or her election to an allowable alternative payout
period by completing and submitting to the Committee an Amended
Benefit Election and Beneficiary Designation Form setting forth such
change, in accordance with such procedures and time frames as may be
established from time to time at the sole
14
<PAGE> 20
discretion of the Committee, provided that any such Amended Benefit
Election and Beneficiary Designation Form is submitted prior to the
commencement of the calendar year of the Participant's Retirement and
at least three (3) months prior to the Participant's Retirement, and
such Amended Benefit Election and Beneficiary Designation Form is
accepted by the Committee in its sole discretion. The Benefit
Election and Beneficiary Designation Form most recently accepted by
the Committee shall govern the payout of the Retirement Benefit. If a
Participant does not make any election with respect to the payment of
the Retirement Benefit, then such benefit shall be payable as
provided in Section 6.2. Subject to Article 5, the lump sum payment
shall be made, or installment payments shall commence, no later than
60 days after the date the Participant Retires.
7.3 Death Prior to Completion of Retirement Benefit. If a Participant
dies after Retirement but before the Retirement Benefit is paid in
full, the Participant's unpaid Retirement Benefit payments shall
continue and shall be paid to the Participant's Beneficiary (a) over
the remaining number of months and in the same amounts as that
benefit would have been paid to the Participant had the Participant
survived, or (b) subject to Article 5, in a lump sum, if requested by
the Beneficiary and allowed in the sole discretion of the Committee,
that is equal to the Participant's unpaid remaining Aggregate Vested
Balance.
ARTICLE 8
Pre-Retirement Survivor Benefit
8.1 Pre-Retirement Survivor Benefit. Subject to Article 5, a
Participant's Beneficiary shall receive a Pre-Retirement Survivor
Benefit equal to the Participant's Aggregate Vested Balance, if the
Participant dies before he or she Retires, experiences a Termination
of Employment or suffers a Disability.
8.2 Payment of Pre-Retirement Survivor Benefit. A Participant, in
connection with his or her commencement of participation in the Plan,
shall elect on a Benefit Election and Beneficiary Designation Form
whether the Pre-Retirement Survivor Benefit shall be received by his
or her Beneficiary in a lump sum or in substantially equal monthly
payments over a period of 60, 120 or 180 months. The Participant may
change this election to an allowable alternative payout period by
completing and submitting to the Committee an Amended Benefit
Election and Beneficiary Designation Form in accordance with such
procedures and time frames as may be established from time to time at
the sole discretion of the Committee, which form must be accepted by
the Committee in its sole discretion. The Benefit Election and
Beneficiary Designation Form most recently accepted by the Committee
prior to the Participant's death shall govern the payout of the
Participant's Pre-Retirement Survivor Benefit. If a Participant does
not make any election with respect to the payment of the
Pre-retirement Survivor Benefit, then such benefit shall be paid in a
lump sum, provided, however that if the Participant's Aggregate
Vested Balance at the time of his or her death is greater than
$25,000, payment may be made, in the sole discretion of the
Committee, in a lump sum
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<PAGE> 21
or in monthly installment payments that do not exceed five (5) years
in duration. Subject to Article 5, the lump sum payment shall be
made, or installment payments shall commence, no later than 60 days
after the date the Committee is provided with proof that is
satisfactory to the Committee of the Participant's death.
ARTICLE 9
Disability Benefit
9.1 Disability Benefit A Participant suffering a Disability shall
receive a Disability Benefit equal to his or her Aggregate Vested
Balance. Subject to Article 5, the Disability Benefit shall be paid
in a lump sum within 60 days of the Committee's exercise of such
right, provided, however, that should the Participant otherwise have
been eligible to Retire, he or she shall be paid a Retirement Benefit
in accordance with Article 7.
ARTICLE 10
Beneficiary Designation
10.1 Beneficiary. Each Participant shall have the right, at any time,
to designate his or her Beneficiary(ies) (both primary as well as
contingent) to receive any benefits payable under the Plan to a
beneficiary upon the death of a Participant. The Beneficiary
designated under this Plan may be the same as or different from the
Beneficiary designation under any other plan of an Employer in which
the Participant participates.
10.2 Beneficiary Designation; Change; Spousal Consent. A Participant
shall designate his or her Beneficiary by completing and signing a
Benefit Election and Beneficiary Designation Form, and returning it
to the Committee or its designated agent. A Participant shall have
the right to change a Beneficiary by completing, signing and
submitting to the Committee an Amended Benefit Election and
Beneficiary Designation Form in accordance with the Committee's rules
and procedures, as in effect from time to time. If the Participant
names someone other than his or her spouse as a Beneficiary, a
spousal consent, in the form designated by the Committee, must be
signed by that Participant's spouse and returned to the Committee.
Upon the acceptance by the Committee of an Amended Benefit Election
and Beneficiary Designation Form, all Beneficiary designations
previously filed shall be canceled. The Committee shall be entitled
to rely on the last Benefit Election and Beneficiary Designation Form
filed by the Participant and accepted by the Committee prior to his
or her death.
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<PAGE> 22
10.3 Acknowledgment. No designation or change in designation of a
Beneficiary shall be effective until received, accepted and
acknowledged in writing by the Committee or its designated agent.
10.4 No Beneficiary Designation. If a Participant fails to designate
a Beneficiary as provided above or, if all designated Beneficiaries
predecease the Participant or die prior to complete distribution of
the Participant's benefits, then the Participant's designated
Beneficiary shall be deemed to be his or her surviving spouse. If the
Participant has no surviving spouse, the benefits remaining under the
Plan to be paid to a Beneficiary shall be payable to the executor or
personal representative of the Participant's estate.
10.5 Doubt as to Beneficiary. If the Committee has any doubt as to
the proper Beneficiary to receive payments pursuant to this Plan, the
Committee shall have the right, exercisable in its discretion, to
cause the Participant's Employer to withhold such payments until this
matter is resolved to the Committee's satisfaction.
10.6 Discharge of Obligations. The payment of benefits under the Plan
to a Beneficiary shall fully and completely discharge all Employers
and the Committee from all further obligations under this Plan with
respect to the Participant, and each of the Participant's Annual
Deferral Agreements shall terminate upon such full payment of
benefits.
ARTICLE 11
Leave of Absence
11.1 Paid Leave of Absence. If a Participant is authorized by the
Participant's Employer for any reason to take a paid leave of absence
from the employment of the Employer, the Participant shall continue
to be considered employed by the Employer and the appropriate amounts
shall continue to be withheld from the Participant's compensation
pursuant to the Participant's then current Annual Election Form.
11.2 Unpaid Leave of Absence. If a Participant is authorized by the
Participant's Employer for any reason to take an unpaid leave of
absence from the employment of the Employer, the Participant shall
continue to be considered employed by the Employer and the
Participant shall be excused from making deferrals until the earlier
of the date the leave of absence expires or the Participant returns
to a paid employment status. Upon such expiration or return,
deferrals shall resume for the remaining portion of the Plan Year in
which the expiration or return occurs, based on the deferral
election, if any, made for that Plan Year. If no election was made
for that Plan Year, no deferral shall be withheld.
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<PAGE> 23
ARTICLE 12
Termination, Amendment or Modification
12.1 Termination. Although the Employers anticipate that they will
continue the Plan for an indefinite period of time, there is no
guarantee that any Employer will continue the Plan or will not
terminate the Plan at any time in the future. Accordingly, each
Employer reserves the right to discontinue its sponsorship of the
Plan and to terminate the Plan, at any time, with respect to its
participating Employees by action of its board of directors. Upon the
termination of the Plan with respect to any Employer, subject to
Section 5.4, all amounts credited to each of the Plan Accounts of
each affected Participant shall be 100% vested and shall be paid to
the Participant or, in the case of the Participant's death, to the
Participant's Beneficiary, in a lump sum notwithstanding any
elections made by the Participant, and the Annual Deferral Agreements
relating to each of the Participant's Plan Accounts shall terminate
upon full payment of such Aggregate Vested Balance.
12.2 Amendment. The Company may, at any time, amend or modify the
Plan in whole or in part with respect to any or all Employers by the
actions of the Board; provided, however, that (i) no amendment or
modification shall be effective to decrease or restrict the value of
a Participant's Aggregate Vested Balance in existence at the time the
amendment or modification is made, calculated as if the Participant
had experienced a Termination of Employment as of the effective date
of the amendment or modification, or, if the amendment or
modification occurs after the date upon which the Participant was
eligible to Retire, the Participant had Retired as of the effective
date of the amendment or modification, and (ii) except as
specifically provided in Section 12.1, no amendment or modification
shall be made after a Change in Control which adversely affects the
vesting, calculation or payment of benefits hereunder or diminishes
any other rights or protections any Participant or Beneficiary would
have had but for such amendment or modification, unless each affected
Participant or Beneficiary consents in writing to such amendment.
12.3 Effect of Payment. The full payment of the applicable benefit
under the provisions of the Plan shall completely discharge all
obligations to a Participant and his or her designated Beneficiaries
under this Plan and each of the Participant's Annual Deferral
Agreements shall terminate.
ARTICLE 13
Administration
13.1 Committee Duties. This Plan shall be administered by a Committee
which shall consist of the Board, or such committee as the Board
shall appoint. Members of the Committee may be Participants under
this Plan. The Committee shall also have the discretion and authority
to (i) make, amend, interpret, and enforce all appropriate rules
18
<PAGE> 24
and regulations for the administration of this Plan and (ii) decide
or resolve any and all questions including interpretations of this
Plan, as may arise in connection with the Plan. Any individual
serving on the Committee who is a Participant shall not vote or act
on any matter relating solely to himself or herself. When making a
determination or calculation, the Committee shall be entitled to rely
on information furnished by a Participant or the Company.
13.2 Agents. In the administration of this Plan, the Committee may,
from time to time, employ agents and delegate to them such
administrative duties as it sees fit (including acting through a duly
appointed representative) and may from time to time consult with
counsel who may be counsel to any Employer.
13.3 Binding Effect of Decisions. The decision or action of the
Committee with respect to any question arising out of or in
connection with the administration, interpretation and application of
the Plan and the rules and regulations promulgated hereunder shall be
final and conclusive and binding upon all persons having any interest
in the Plan.
13.4 Indemnity of Committee. All Employers shall indemnify and hold
harmless the members of the Committee, and any Employee to whom
duties of the Committee may be delegated, against any and all claims,
losses, damages, expenses or liabilities arising from any action or
failure to act with respect to this Plan, except in the case of
willful misconduct by the Committee or any of its members or any such
Employee.
13.5 Employer Information. To enable the Committee to perform its
functions, each Employer shall supply full and timely information to
the Committee on all matters relating to the compensation of its
Participants, the date and circumstances of the Retirement,
Disability, death or Termination of Employment of its Participants,
and such other pertinent information as the Committee may reasonably
require.
ARTICLE 14
Other Benefits and Agreements
The benefits provided for a Participant and Participant's
Beneficiary under the Plan are in addition to any other benefits available to
such Participant under any other plan or program for employees of the
Participant's Employer. The Plan shall supplement and shall not supersede,
modify or amend any other such plan or program except as may otherwise be
expressly provided.
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<PAGE> 25
ARTICLE 15
Claims Procedures
15.1 Presentation of Claim. Any Participant or Beneficiary of a
deceased Participant (such Participant or Beneficiary being referred
to below as a "Claimant") may deliver to the Committee a written
claim for a determination with respect to the amounts distributable
to such Claimant from the Plan. If such a claim relates to the
contents of a notice received by the Claimant, the claim must be made
within 60 days after such notice was received by the Claimant. The
claim must state with particularity the determination desired by the
Claimant. All other claims must be made within 180 days of the date
on which the event that caused the claim to arise occurred. The claim
must state with particularity the determination desired by the
Claimant.
15.2 Notification of Decision. The Committee shall consider a
Claimant's claim within a reasonable time, and shall notify the
Claimant in writing:
(a) that the Claimant's requested determination has been made, and
that the claim has been allowed in full; or
(b) that the Committee has reached a conclusion contrary, in whole
or in part, to the Claimant's requested determination, and such
notice must set forth in a manner calculated to be understood
by the Claimant:
(i) the specific reason(s) for the denial of the claim, or
any part of it;
(ii) specific reference(s) to pertinent provisions of the
Plan upon which such denial was based;
(iii) a description of any additional material or
information necessary for the Claimant to perfect the
claim, and an explanation of why such material or
information is necessary; and
(iv) an explanation of the claim review procedure set forth
in Section 15.3 below.
15.3 Review of a Denied Claim. Within 60 days after receiving a
notice from the Committee that a claim has been denied, in whole or
in part, a Claimant (or the Claimant's duly authorized
representative) may file with the Committee a written request for a
review of the denial of the claim. Thereafter, but not later than 30
days after the review procedure began, the Claimant (or the
Claimant's duly authorized representative):
(a) may review pertinent documents;
(b) may submit written comments or other documents; and/or
(c) may request a hearing, which the Committee, in its sole
discretion, may grant.
20
<PAGE> 26
15.4 Decision on Review. The Committee shall render its decision on
review promptly, and not later than 60 days after the filing of a
written request for review of the denial, unless a hearing is held or
other special circumstances require additional time, in which case
the Committee's decision must be rendered within 120 days after such
date. Such decision must be written in a manner calculated to be
understood by the Claimant, and it must contain:
(a) specific reasons for the decision;
(b) specific reference(s) to the pertinent Plan provisions upon
which the decision was based; and
(c) such other matters as the Committee deems relevant.
15.5 Arbitration. A Claimant's compliance with the foregoing
provisions of this Article 15 is a mandatory prerequisite to a
Claimant's right to commence any arbitration with respect to any
claim for benefits under this Plan. Any and all claims that are not
resolved to the satisfaction of a Claimant under the above provisions
of this Article 15 shall be subject to arbitration conducted in
Albany, New York before a panel of three (3) arbitrators pursuant to
rules of the National Association of Securities Dealers. Unless
otherwise provided herein each party shall bear its own costs and
expenses in connection with such arbitration and the parties shall
contribute equally the arbitrator's fees. The arbitrator's decision
in any dispute shall be final and binding and shall not be subject to
appeal or judicial review.
ARTICLE 16
Trust
16.1 Establishment of the Trust. The Company may establish one or
more Trusts to which the Employers may transfer such assets as the
Employers determine in their sole discretion to assist in meeting
their obligations under the Plan.
16.2 Interrelationship of the Plan and the Trust. The provisions of
the Plan and the relevant Annual Deferral Agreements shall govern the
rights of a Participant to receive distributions pursuant to the
Plan. The provisions of the Trust shall govern the rights of the
Employers, Participants and the creditors of the Employers to the
assets transferred to the Trust.
16.3 Distributions From the Trust. Each Employer's obligations under
the Plan may be satisfied with Trust assets distributed pursuant to
the terms of the Trust, and any such distribution shall reduce the
Employer's obligations under this Agreement.
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<PAGE> 27
ARTICLE 17
Miscellaneous
17.1 Status of Plan. The Plan is intended to be a plan that is not
qualified within the meaning of Code Section 401(a) and that "is
unfunded and is maintained by an employer primarily for the purpose
of providing deferred compensation for a select group of management
or highly compensated employee" within the meaning of ERISA Sections
201(2), 301(a)(3) and 401(a)(1). The Plan shall be administered and
interpreted to the extent possible in a manner consistent with that
intent. All Plan Accounts and all credits and other adjustments to
such Plan Accounts shall be bookkeeping entries only and shall be
utilized solely as a device for the measurement and determination of
amounts to be paid under the Plan. No Plan Accounts, credits or other
adjustments under the Plan shall be interpreted as an indication that
any benefits under the Plan are in any way funded.
17.2 Unsecured General Creditor. Participants and their
Beneficiaries, heirs, successors and assigns shall have no legal or
equitable rights, interests or claims in any property or assets of an
Employer. For purposes of the payment of benefits under this Plan,
any and all of an Employer's, assets, shall be, and remain, the
general, unpledged unrestricted assets of the Employer. An Employer's
obligation under the Plan shall be merely that of an unfunded and
unsecured promise to pay money in the future.
17.3 Employer's Liability. An Employer's liability for the payment of
benefits shall be defined only by the Plan and the Plan Agreement, as
entered into between the Employer and a Participant. An Employer
shall have no obligation to a Participant under the Plan except as
expressly provided in the Plan and his or her Plan Agreement.
17.4 Nonassignability. Neither a Participant nor any other person
shall have any right to commute, sell, assign, transfer, pledge,
anticipate, mortgage or otherwise encumber, transfer, hypothecate,
alienate or convey in advance of actual receipt, the amounts, if any,
payable hereunder, or any part thereof, which are, and all rights to
which are expressly declared to be, unassignable and
non-transferable. No part of the amounts payable shall, prior to
actual payment, be subject to seizure, attachment, garnishment or
sequestration for the payment of any debts, judgments, alimony or
separate maintenance owed by a Participant or any other person, be
transferable by operation of law in the event of a Participant's or
any other person's bankruptcy or insolvency or be transferable to a
spouse as a result of a property settlement or otherwise.
17.5 Not a Contract of Employment. The terms and conditions of this
Plan and the Annual Deferral Agreements under this Plan shall not be
deemed to constitute a contract of employment between any Employer
and the Participant. Such employment is hereby acknowledged to be an
"at will" employment relationship that can be terminated at any time
for any reason, or no reason, with or without cause, and with or
without notice, except as otherwise provided in a written employment
agreement. Nothing in this Plan or any Annual Deferral Agreement
shall be deemed to give a
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<PAGE> 28
Participant the right to be retained in the service of any Employer
as an Employee or to interfere with the right of any Employer to
discipline or discharge the Participant at any time.
17.6 Furnishing Information. A Participant or his or her Beneficiary
will cooperate with the Committee by furnishing any and all
information requested by the Committee and take such other actions as
may be requested in order to facilitate the administration of the
Plan and the payments of benefits hereunder, including but not
limited to taking such physical examinations as the Committee may
deem necessary.
17.7 Terms. Whenever any words are used herein in the masculine, they
shall be construed as though they were in the feminine in all cases
where they would so apply; and whenever any words are used herein in
the singular or in the plural, they shall be construed as though they
were used in the plural or the singular, as the case may be, in all
cases where they would so apply.
17.8 Captions. The captions of the articles, sections and paragraphs
of this Plan are for convenience only and shall not control or affect
the meaning or construction of any of its provisions.
17.9 Governing Law. Subject to ERISA, the provisions of this Plan
shall be construed and interpreted according to the internal laws of
the State of New York without regard to its conflicts of laws
principles.
17.10 Notice. Any notice or filing required or permitted to be given
to the Committee under this Plan shall be sufficient if in writing
and hand-delivered, or sent by registered or certified mail, to the
address below:
First Albany Companies Inc.
30 South Pearl Street
Albany, New York 12207
Attn: General Counsel
Such notice shall be deemed given as of the date of delivery or, if
delivery is made by mail, as of the date shown on the postmark or the
receipt for registration or certification.
Any notice or filing required or permitted to be given to a
Participant under this Plan shall be sufficient if in writing and
hand-delivered, or sent by mail, to the last known address of the
Participant.
17.11 Successors. The provisions of this Plan shall bind and inure to
the benefit of the Participant's Employer and its successors and
assigns and the Participant and the Participant's designated
Beneficiaries.
17.12 Spouse's Interest. The interest in the benefits hereunder of a
spouse of a Participant who has predeceased the Participant shall
automatically pass to the Participant and shall not be transferable
by such spouse in any manner, including but
23
<PAGE> 29
not limited to such spouse's will, nor shall such interest pass under
the laws of intestate succession.
17.13 Validity. In case any provision of this Plan shall be illegal
or invalid for any reason, said illegality or invalidity shall not
affect the remaining parts hereof, but this Plan shall be construed
and enforced as if such illegal or invalid provision had never been
inserted herein.
17.14 Incompetent. If the Committee determines in its discretion that
a benefit under this Plan is to be paid to a minor, a person declared
incompetent or to a person incapable of handling the disposition of
that person's property, the Committee may direct payment of such
benefit to the guardian, legal representative or person having the
care and custody of such minor, incompetent or incapable person. The
Committee may require proof of minority, incompetence, incapacity or
guardianship, as it may deem appropriate prior to distribution of the
benefit. Any payment of a benefit shall be a payment for the account
of the Participant and the Participant's Beneficiary, as the case may
be, and shall be a complete discharge of any liability under the Plan
for such payment amount.
17.15 Distribution in the Event of Taxation. If, for any reason, all
or any portion of a Participant's benefit under this Plan becomes
taxable to the Participant prior to receipt, a Participant may
petition the Committee before a Change in Control, or the trustee of
the Trust after a Change in Control, for a distribution of that
portion of his or her benefit that has become taxable. Upon the grant
of such a petition, which grant shall not be unreasonably withheld, a
Participant's Employer shall, subject to Section 5.4, distribute to
the Participant immediately available funds in an amount equal to the
taxable portion of his or her benefit (which amount shall not exceed
a Participant's unpaid Aggregate Vested Balance under the Plan). If
the petition is granted, the tax liability distribution shall be made
within 90 days of the date when the Participant's petition is
granted. Such a distribution shall affect and reduce the benefits to
be paid under this Plan.
17.16 Insurance. The Employers, on their own behalf or on behalf of
the trustee of the Trust, and, in their sole discretion, may apply
for and procure insurance on the life of the Participant, in such
amounts and in such forms as the Trust may choose. The Employers or
the trustee of the Trust, as the case may be, shall be the sole owner
and beneficiary of any such insurance. The Participant shall have no
interest whatsoever in any such policy or policies, and at the
request of the Employers shall submit to medical examinations and
supply such information and execute such documents as may be required
by the insurance company or companies to whom the Employers have
applied for insurance.
17.17 Legal Fees To Enforce Rights After Change in Control. The
Company and each Employer is aware that upon the occurrence of a
Change in Control, the Board or the board of directors of the
Participant's Employer (which might then be composed of new members)
or a shareholder of the Company or the Participant's Employer, or of
any successor corporation might then cause or attempt to cause the
Company or the
24
<PAGE> 30
Participant's Employer or such successor to refuse to comply with its
obligations under the Plan and might cause or attempt to cause the
Company or the Participant's Employer to institute, or may institute,
arbitration or litigation seeking to deny Participants the benefits
intended under the Plan. In these circumstances, the purpose of the
Plan could be frustrated. Accordingly, if, following a Change in
Control, it should appear to any Participant that the Company, the
Participant's Employer or any successor corporation has failed to
comply with any of its obligations under the Plan or any agreement
thereunder or, if the Company, such Employer or any other person
takes any action to declare the Plan void or unenforceable or
institutes any arbitration, litigation or other legal action designed
to deny, diminish or to recover from any Participant the benefits
intended to be provided, then the Company and the Participant's
Employer irrevocably authorize such Participant to retain counsel of
his or her choice at the expense of the Company and the Employer (who
shall be jointly and severally liable) to represent such Participant
in connection with the initiation or defense of any arbitration,
litigation or other legal action, whether by or against the Company,
the Participant's Employer or any director, officer, shareholder or
other person affiliated with the Company, the Participant's Employer
or any successor thereto in any jurisdiction.
25
<PAGE> 31
IN WITNESS WHEREOF, the Company has signed this Plan document as of
______________, 1999.
First Albany Companies Inc.
a New York corporation
By:____________________________
Name:__________________________
Title:___________________________
26
<PAGE> 1
EXHIBIT 5(a)
[FIRST ALBANY COMPANIES INC. LETTERHEAD]
May 19, 1999
First Albany Companies Inc.
30 South Pearl Street
Albany, NY 12207
RE: First Albany Companies Inc. - Registration Statement on Form
S-8 relating to the First Albany Companies Inc. Financial
Consultants Deferred Compensation Plan (the "Registration
Statement")
Ladies and Gentlemen:
I am Secretary and General Counsel of First Albany Companies Inc., a
New York corporation ("First Albany"), and I am familiar with the proceedings
taken by First Albany in connection with the proposed offering of up to
$3,000,000 in principle amount of deferred compensation obligations (the
"Obligations") and up to 200,000 shares of First Albany common stock, par value
$.01 (the "Shares"), by First Albany pursuant to the First Albany Companies Inc.
Financial Consultants Deferred Compensation Plan (the "Plan"), with respect to
which the Registration Statement has been prepared for filing with the
Securities and Exchange Commission under the Securities Act of 1933.
In arriving at the opinions expressed below, I have reviewed the
Registration Statement and the Plan. In addition, I reviewed the originals or
copies certified or otherwise identified to my satisfaction of all such
corporate records of First Albany and such other instruments and other
certificates of public officials, officers and representatives of First Albany
and such other persons, and I have made such investigations of law, as I have
deemed appropriate as a basis for the opinion express below.
In rendering the opinions expressed below, I have assumed the
authenticity of all documents submitted to me as originals and the conformity to
the originals of all documents submitted to me as copies. In addition, I have
assumed and have not verified the accuracy as to factual matters of each
document I have reviewed.
Based upon the foregoing, and subject to the further assumptions and
qualifications set forth below, it is my opinion that:
1. When
a. the applicable provisions of the Securities Act of 1933 and of
State securities or "blue sky" laws shall have been complied
with; and
b. the Company's Board of Directors shall have duly authorized
the issue and sale of the Obligations;
the Obligations will be legally issued, fully paid and nonassessable; and
<PAGE> 2
2. When
a. the applicable provisions of the Securities Act of 1933 and of
State securities or "blue sky" laws shall have been complied
with;
b. the Company's Board of Directors shall have duly authorized
the issue and sale of the Shares; and
c. the Shares shall have been duly issued and paid for (in an
amount not less than $.01 par value thereof);
the Shares will be legally issued, fully paid and nonassessable.
Insofar as the foregoing opinions relate to the legality, validity,
binding effect or enforceability of any agreement or obligation of First Albany,
(a) I have assumed that each other party to such agreement or obligation has
satisfied those legal requirements that are applicable to it to the extent
necessary to make such agreement or obligation enforceable against it and (b)
such opinion is subject to applicable bankruptcy, insolvency and similar laws
affecting creditor's rights generally and to general principles of equity.
The foregoing opinion is limited to the Federal laws of the United
States of America and the law of the State of New York.
I hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement.
Very truly yours,
/s/ Stephen P. Wink
Stephen P. Wink
Secretary
General Counsel
<PAGE> 1
EXHIBIT 23(a)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated February 12, 1999 relating to the
financial statements and financial statement schedule, which appears in First
Albany Companies Inc.'s Annual Report on Form 10-K for the year ended December
31, 1998.
/s/ PricewaterhouseCoopers LLP
Albany, New York
May 17, 1999
