EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (this “Agreement”), dated as of June 30, 2006 (the “Effective Date”),
between FIRST ALBANY COMPANIES INC., a New York corporation (the “Company”), and XXXXX XxXXXXXXX
(the “Executive”).
W I T N E S S E T H:
WHEREAS, the Company desires to employ the Executive as its Chief Executive Officer so that it
will have the benefit of his ability, experience and services, and the Executive is willing to
enter into an agreement to that end, upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby covenant and agree as follows:
| 1. | Employment |
The Company hereby agrees to employ the Executive as the Chief Executive Officer of the
Company, and the Executive hereby agrees to be employed by the Company in such capacity, on and
subject to the terms and conditions of this Agreement.
| 2. | Agreement Term |
The period of this Agreement (the “Agreement Term”) shall commence on the Effective Date and
shall expire on the second anniversary of the Effective Date. At least 90 days prior to expiration
of the Agreement Term, each party hereto shall give notice to the other party of his or its
intention to (i) enter into a new employment agreement at the expiration of the Agreement Term, or
(ii) terminate the Agreement at the expiration of the Agreement Term. The period of the
Executive’s employment hereunder shall be hereinafter referred to as the “Employment Period.”
| 3. | Position, Duties and Responsibilities |
(a) The Executive shall serve as, and with the title, office and authority of, the Chief
Executive Officer of the Company. The Executive shall also hold such title, office and authority
with the Company’s subsidiaries and its successors. Within five days of the Effective Date, the
Board of Directors of the Company (the “Board”) shall appoint the Executive as a member of the
Board and thereafter shall nominate the Executive for election as a member of the Board when his
seat on the Board is up for re-election.
(b) The Executive shall have all the powers, authority, duties and responsibilities
incident to the position and office of Chief Executive Officer of the Company, including
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effective supervision and control over, and responsibility for, the implementation of the
Company’s strategic plan and general and active day-to-day leadership and management of the
business and affairs of the Company and the subsidiaries of the Company, including without
limitation the authority with respect to the employment of the Company’s senior management, subject
to the Company’s by-laws with respect to the appointment of officers. The Executive shall report
directly to the Board. The Executive shall act in accordance with and, subject to the Board’s
authority (but without limitation of the Executive’s rights under Section 6(c)(v) hereof), have the
requisite authority to implement the Company’s strategic plans in effect from time to time,
including the strategic plan approved by resolution of the Board on June 29, 2006 (the “Strategic
Plan”). The Executive shall seek prior approval from the Board of any proposed material change
from the strategic plan.
(c) The Executive agrees to devote substantially all of his business time, efforts and
skills to the performance of his duties and responsibilities under this Agreement;
provided, however, that nothing in this Agreement shall preclude the Executive from
devoting reasonable periods required for (i) participating in professional, educational,
philanthropic, public interest, charitable, social or community activities, (ii) serving as a
member of the board of directors of other corporations, or (iii) managing his personal investments
or other personal business so long as these activities, individually or in the aggregate, do not
materially interfere with the discharge of the Executive’s duties hereunder.
(d) The Executive shall perform his duties at the offices of the Company located in New
York City, but from time to time the Executive may be required to travel to other locations in the
proper conduct of his responsibilities under this Agreement.
| 4. | Compensation and Benefits |
In consideration of the services rendered by the Executive during the Employment Period, the
Company shall pay or provide the Executive the compensation and benefits set forth below.
(a) Base Salary. The Company shall pay the Executive a minimum base salary (the
“Base Salary”) equal to $200,000 per annum. The Compensation Committee of the Board (the
“Compensation Committee”) will review the Base Salary at least annually during the Employment
Period with a view toward consideration of merit increases as the Compensation Committee deems
appropriate. The Base Salary shall be paid in accordance with the normal payroll practices of the
Company.
(b) Annual Bonuses. The Company shall provide the Executive with the opportunity
to earn an annual bonus for each fiscal year of the Company ending during the Employment Period.
The annual bonus will be based upon a target bonus amount established by the Board. The bonus
objectives for Executive’s annual bonus for any particular year will be developed by the Board
after good faith consultation with the Executive consistent with the Company’s strategic plan.
(c) Employee Benefits. The Executive shall be entitled to participate in all
employee benefit plans, programs, practices or arrangements of the Company in which other senior
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executives of the Company are eligible to participate from time to time, including, without
limitation, any qualified or non-qualified pension or savings plans, any death benefit or
disability benefit plans, any medical, dental, health or other welfare plans that are approved by
the Compensation Committee, on terms and conditions at least as favorable to the Executive as are
provided to other senior executives of the Company.
(d) Fringe Benefits; Vacation. The Executive shall be entitled to fringe
benefits and perquisites at the same level as are generally made available to senior executives of
the Company. The Executive shall be entitled to the vacation time in accordance with the policy
that applies to senior executives of the Company generally.
| 5. | Equity Incentives |
Effective as of the Effective Date, the Executive shall be granted 50,000 shares of restricted
common stock of the Company (the “Restricted Stock”). The Restricted Stock shall vest in two equal
installments on each of the first and second anniversaries of the Effective Date, and shall become
fully vested upon a Change of Control (as defined under the Company’s 1999 Long-Term Incentive Plan
(“Change of Control”). The Executive shall also be eligible for future awards under the Company’s
equity-based incentive plans, as determined on an annual basis by the Compensation Committee in its
sole discretion.
| 6. | Termination of Employment |
The Employment Period may be terminated upon the occurrence of any of the following events:
(a) Termination for Cause. The Company may terminate the Executive’s employment
hereunder for Cause. For purposes of this Agreement, the Executive shall be considered to be
terminated for “Cause” only upon (i) the Executive’s conviction of, or plea of guilty or nolo
contendere to, a felony under the laws of the United States or any state thereof, whether or not
appeal is taken, (ii) the Executive’s conviction of, or plea of guilty or nolo contendere to, a
violation of criminal law involving the Company and its business, (iii) the willful material
misconduct of the Executive or the Executive’s willful violation of material Company policies, in
either case which has a demonstrable adverse effect on the Company; (iv) the Executive’s continued
failure to perform his duties (except as provided in Section 6(e)) hereunder after provision of
written notice by the Company requesting such performance; or (v) the willful fraud or material
dishonesty of the Executive in connection with his performance of duties to the Company.
However, in no event shall the Executive’s employment be considered to have been terminated for
“Cause” unless and until the Executive receives a copy of a resolution adopted by the Board finding
that, in the good faith opinion of the Board, the Executive is guilty of acts or omissions
constituting Cause, which resolution has been duly adopted by an affirmative vote of a majority of
the Board, excluding the Executive and any individual alleged to have participated in the acts
constituting “Cause.” Any such vote shall be taken at a meeting of the Board called and held for
such purpose, after reasonable written notice is provided to the Executive setting forth in
reasonable detail the facts and circumstances claimed to provide a basis of termination for
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Cause and the Executive is given an opportunity, together with counsel, to be heard before the
Board.
(b) Termination without Cause. The Board shall have the right to terminate the
Executive’s employment hereunder other than for Cause at any time, subject to the consequences of
such termination as set forth in this Agreement.
(c) Resignation for Good Reason. The Executive may voluntarily terminate his
employment hereunder for Good Reason. For purposes of this Agreement, “Good Reason” shall mean:
(i) the assignment to the Executive of any duties materially inconsistent with the
Executive’s position (including status, offices, titles or reporting relationships),
authority, duties or responsibilities as contemplated by Section 3 hereof, any adverse
change in the Executive’s reporting responsibilities, any action by the Company that results
in a material diminution in such position, authority, duties or responsibilities, or any
failure to appoint and nominate the Executive to the Board as provided in Section 3(a)
hereof; provided that the Executive shall not have Good Reason under this clause (i)
if, after a Change of Control, the Executive continues as the senior most executive officer
of the business of the Company and its subsidiaries as conducted immediately prior to the
Change of Control;
(ii) without limitation or any other provision of this Section 6(c), any failure by the
Company to comply with its obligations under Sections 4, 5, 8, 12(a) or 18 hereof;
(iii) the relocation, without the consent of the Executive, of the Executive’s
principal business office to a location outside of New York City;
(iv) any failure to accomplish the following elements of the previously approved Board
restructuring: (A) three individuals who are members of the Board on the Effective Date (all
members collectively, “Current Members”) shall cease to serve on the Board effective on or
before the 90th day following the Effective Date; (B) two other Current Members shall cease
to serve on the Board, effective either before or promptly after the Executive has proposed
to the Board director candidates to be appointed in the resigning directors’ place, such
director candidates to be promptly appointed or elected to the Board; and (C) one other
Current Member shall cease to serve on the Board before or effective on the date of the
Company’s 2007 annual meeting of stockholders (the “Annual Meeting”), provided that the
Executive has identified a director candidate to take the resigning director’s place, such
director candidate is appointed to the Board or is nominated by the Board for approval by
the stockholders at the Annual Meeting; and in the case of clauses (B) and (C) above,
subject to the condition that (I) such director candidate(s) must be (A) ready, willing and
able to serve on the Board and (B) reasonably qualified by education, background and
training to serve on the Board and (II) the appointment or election of such director
candidate(s) not violate law or any exchange listing requirement applicable to the Company;
and
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(v) until the earlier of the completion of the Board restructuring described in clause
(iv) or the date immediately following the Annual Meeting, the Board, by action or omission,
either overrules, vetoes, countermands, obstructs, constrains or otherwise frustrates or
delays, in any material respect, the Executive’s good faith efforts to accomplish any
material aspect of the Strategic Plan.
However, in no event shall the Executive be considered to have terminated his employment for “Good
Reason” unless and until the Company receives written notice from the Executive identifying in
reasonable detail the acts or omissions constituting “Good Reason” and the provision of this
Agreement relied upon, and, to the extent such circumstance is susceptible to cure, such acts or
omissions are not cured by the Company within 15 days of the Company’s receipt of such notice.
(d) Resignation without Good Reason. The Executive may voluntarily terminate his
employment hereunder for any reason at any time, including for any reason that does not constitute
Good Reason.
(e) Disability. The Executive’s employment hereunder shall terminate upon his
Disability. For purposes of this Agreement, “Disability” shall mean the inability of the Executive
to perform his duties to the Company on account of physical or mental illness or incapacity for a
period of 180 calendar days, whether or not consecutive, during any 365 day period. The
Executive’s employment hereunder shall be deemed terminated by reason of Disability on the last day
of the applicable period; provided, however, in no event shall the Executive be
terminated by reason of Disability unless the Executive receives written notice from the Company,
at least 15 days in advance of such termination, stating its intention to terminate the Executive
for reason of Disability.
(f) Death. The Executive’s employment hereunder shall terminate upon his death.
| 7. | Compensation upon Termination of Employment |
In the event the Executive’s employment by the Company is terminated during the Agreement
Term, the Executive shall be entitled to the severance payments and benefits specified below:
(a) Resignation for Good Reason; Termination without Cause. In the event the
Executive voluntarily terminates his employment hereunder for Good Reason or is terminated by the
Company other than for Cause, death or Disability, the Company shall pay the Executive and provide
him with the following:
(i) Accrued Rights. Upon the Executive’s termination of employment, the
Company shall pay the Executive a lump-sum amount equal to the sum of (A) his earned but
unpaid Base Salary through the date of termination, (B) any earned but unpaid annual bonus
for any completed fiscal year, and (C) any unreimbursed business expenses or other amounts
due to the Executive from the Company as of the date of termination under any written
Company policy or written agreement with the Executive. In addition, the Company shall
provide to the Executive all payments, rights and benefits due as of the
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date of termination under the terms of the Company’s employee and fringe benefit plans
and programs in which the Executive participated during the Employment Period (together with
the lump-sum payments described above, the “Accrued Rights”).
(ii) Severance Payment. The Company shall pay the Executive a lump-sum payment
equal to 1.5 times the sum of (A) his then-current annual Base Salary and (B) the average of
the annual bonus amounts previously paid or payable to the Executive in respect of the three
most recently completed fiscal years. Such lump-sum severance payments shall be made within
five business days following the effective date of termination of employment. The Executive
shall also be entitled to a lump-sum payment of the pro-rata portion of the annual bonus the
Executive would have earned if he had remained employed by the Company through the end of
the applicable fiscal year, determined in the same manner as for other senior executives of
the Company. Such payment shall be made at the time bonuses for the relevant fiscal year
are made to other senior executives of the Company. As a condition to receiving benefits
under this Section 7(a)(ii), the Executive shall be required to deliver an irrevocable
general release of claims against the Company Group (as defined below) and their current and
former directors, officers and employees, in the same form as attached hereto as Exhibit A.
(iii) Continued Benefits. For the 18-month period following the date of the
Executive’s termination of employment, the Company shall continue to provide the Executive
and his eligible dependents with the medical, dental, disability and life insurance
coverages that were provided to the Executive immediately prior to termination of employment
(with the same employee cost-sharing as active employees of the Company during such period),
subject to cancellation by the Company in the event that the Executive becomes eligible for
coverage under plans of another employer. Following the expiration of such 18-month period,
the Executive and his eligible dependents shall be entitled to continue participating in the
Company’s group health plans in accordance with the health care continuation requirements of
the Consolidated Omnibus Reconciliation Act of 1985 (“COBRA”).
(iv) Vesting of Equity. At the time of his termination of employment, any
unvested portion of the Restricted Stock or any other restricted stock, stock options or
other equity-based awards held by the Executive at the time of his termination of employment
shall become fully vested and exercisable, notwithstanding the terms of any award agreement
or equity plan applicable to such awards.
(v) Other Benefits. Any deferred compensation benefits accrued to the
Executive as of the date of his termination of employment shall become fully vested and
payable upon his termination of employment.
(b) Resignation without Good Reason; Termination for Cause or upon Death or
Disability. In the event the Executive voluntarily terminates his employment hereunder other
than for Good Reason, is terminated by the Company for Cause, or is terminated on account of
Disability or death, the Company shall pay the Executive and provide him with any Accrued Rights
under Section 7(a)(i).
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| 8. | Parachute Tax Indemnity |
(a) If it shall be determined that any amount paid, distributed or treated as paid or
distributed by the Company to or for the Executive’s benefit (whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or otherwise, but determined
without regard to any additional payments required under this Section 8) (a “Payment”) would be
subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties are
incurred by the Executive with respect to such excise tax (such excise tax, together with any such
interest and penalties, being hereinafter collectively referred to as the “Excise Tax”), then the
Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount
such that after payment by the Executive of all federal, state and local taxes (including any
interest or penalties imposed with respect to such taxes), including, without limitation, any
income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed
upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the
Excise Tax imposed upon the Payments.
(b) All determinations required to be made under this Section 8, including whether and when a
Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be
utilized in arriving at such determination, shall be made by a nationally recognized accounting
firm appointed by the Company (the “Accounting Firm”), which shall provide detailed supporting
calculations both to the Company and the Executive within 15 business days of the receipt of notice
from the Executive that there has been a Payment, or such earlier time as is requested by the
parties. The Accounting Firm shall not be an accounting firm serving as accountant or auditor for
the Company or for the individual, entity or group affecting the Change of Control. All fees and
expenses of the Accounting Firm shall be borne by the Company. Any Gross-Up Payment, as determined
pursuant to this Section 8, shall be paid by the Company to the Executive within five days of the
receipt of the Accounting Firm’s determination. Any determination by the Accounting Firm shall be
binding upon the Company and the Executive. As a result of the uncertainty in the application of
Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder,
it is possible that Gross-Up Payments which will not have been made by the Company should have been
made (“Underpayment”), consistent with the calculations required to be made hereunder. In the
event that the Company exhausts its remedies pursuant to this Section 8 and the Executive
thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the
amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by
the Company to or for the Executive’s benefit.
(c) The Executive shall notify the Company in writing of any claim by the Internal Revenue
Service that, if successful, would require the payment by the Company of the Gross-Up Payment.
Such notification shall be given as soon as practicable but no later then ten business days after
the Executive is informed in writing of such claim and shall apprise the Company of the nature of
such claim and the date on which such claim is requested to be paid. The Executive shall not pay
such claim prior to the expiration of the 30-day period following the date on which it gives such
notice to the Company (or such shorter period ending on the date that any payment of taxes with
respect to such claim is due). If the Company notifies the Executive in writing prior to the
expiration of such period that it desires to contest such claim, the Executive shall: (i) give the
Company any information reasonably requested by the Company relating to such claim;
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(ii) take such action in connection with contesting such claim as the Company shall reasonably
request in writing from time to time, including, without limitation, accepting legal representation
with respect to such claim by an attorney reasonably selected by the Company; (iii) cooperate with
the Company in good faith in order to effectively contest such claim; and (iv) permit the Company
to participate in any proceeding relating to such claim; provided, however, that
the Company shall bear and pay directly all costs and expenses (including additional interest and
penalties) incurred in connection with such contest and shall indemnify and hold the Executive
harmless, on an after-tax basis, from any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such representation and payment of costs and
expense. Without limitation on the foregoing provisions of this Section 8, the Company shall
control all proceedings taken in connection with such contest and, at its sole option, may pursue
or forego any and all administrative appeals, proceedings, hearings and conferences with the taxing
authority in respect of such claim and may, at its sole option, either direct the Executive to pay
the tax claimed and xxx for a refund or contest the claim in any permissible manner, and the
Executive agrees to prosecute such contest to a determination before any administrative tribunal,
in a court of initial jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs the Executive to pay such
claim and xxx for a refund, the Company shall, to the extent permitted by applicable law, advance
the amount of such payment to the Executive, on an interest-free basis, and shall indemnify and
hold the Executive harmless, on an after-tax basis, from any Excise Tax or income tax (including
interest or penalties with respect thereto) imposed with respect to such advance or with respect to
any imputed income with respect to such advance; and further provided that any extension of the
statute of limitations relating to payment of taxes for the Executive’s taxable year with respect
to which such contested amount is claimed to be due is limited solely to such contested amount.
Furthermore, the Company’s control of the contest shall be limited to issues with respect to which
a Gross-Up Payment would be payable hereunder and the Executive shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue Service or any other
taxing authority, so long as such action does not have a material adverse effect on the contest
being pursued by the Company.
(d) If, after the Executive’s receipt of an amount advanced by the Company pursuant to this
Section 8, the Executive becomes entitled to receive any refund with respect to such claim, the
Executive shall (subject to the Company’s complying with the requirements of this Section 8)
promptly pay to the Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the Executive’s receipt of an amount advanced
by the Company pursuant to this Section 8, a determination is made that the Executive shall not be
entitled to any refund with respect to such claim and the Company does not notify the Executive in
writing of its intent to contest such denial of refund prior to the expiration of 30 days after
such determination, then such advance shall be forgiven and shall not be required to be repaid and
the amount of such advance shall offset, to the extent thereof, the amount of Gross-Up Payment
required to be paid.
| 9. | No Mitigation or Offset |
The Executive shall not be required to seek other employment or to reduce any severance
benefit payable to him under Section 7 hereof, and, except as provided in Section 7(a)(iii) hereof,
no such severance benefit shall be reduced on account of any compensation received by the
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Executive from other employment. The Company’s obligation to pay severance benefits under
this Agreement shall not be reduced by any amount owed by the Executive to the Company.
| 10. | Tax Withholding; Method of Payment |
All compensation payable pursuant to this Agreement shall be subject to reduction by all
applicable withholding, social security and other federal, state and local taxes and deductions.
Any lump-sum payments provided for in this Agreement shall be made in a cash payment, net of any
required tax withholding, no later than the fifth business day following the Executive’s date of
termination or other payment date.
| 11. | Restrictive Covenants |
(a) Confidential Information. The Executive acknowledges that during the course of
his employment by the Company he has or will have access to and knowledge of certain information
and data which the Company considers confidential and the release of such information or data to
unauthorized persons would be extremely detrimental to the Company. As a consequence, the
Executive hereby agrees and acknowledges that he owes a duty to the Company not to disclose, and
agrees that without the prior written consent of the Company, at any time, either during or after
his employment with the Company, he will not communicate, publish or disclose, to any person
anywhere or use, any Confidential Information (as hereinafter defined), except as may be necessary
or appropriate to conduct his duties hereunder, provided the Executive is acting in good faith and
in the best interest of the Company, or as may be required by law or judicial process. The
Executive will use his best efforts at all times to hold in confidence and to safeguard any
Confidential Information from falling into the hands of any unauthorized person and, in particular,
will not permit any Confidential Information to be read, duplicated or copied. The Executive will
return to the Company all Confidential Information in the Executive’s possession or under the
Executive’s control whenever the Company shall so request, and in any event will promptly return
all such Confidential Information if the Executive’s relationship with the Company is terminated
for any or no reason and will not retain any copies thereof. For purposes hereof the term
“Confidential Information” shall mean any information or data used by or belonging or relating to
the Company or any of its subsidiaries or Affiliates (the “Company Group”) that is not known
generally to the industry in which the Company is or may be engaged and which the Company maintains
on a confidential basis, including, without limitation, any and all trade secrets, proprietary data
and information relating to the Company’s business and products, price list, customer lists,
processes, procedures or standards, know-how, manuals, business strategies, records, drawings,
specifications, designed, financial information, whether or not reduced to writing, or information
or data which the Company advises the Executive should be treated as confidential information.
(b) Noncompetition. The Executive acknowledges that he has established and will
continue to establish favorable relations with the customers, clients and accounts of the Company
and will have access to trade secrets of the Company Group. Therefore, in consideration of such
relations and to further protect trade secrets, directly or indirectly, of the Company, the
Executive agrees that during the “Noncompetition Period” (as defined below) the Executive shall
not, without the express written consent of the Company, become employed by, or render services to,
a person or entity that provides investment banking services to small and/or mid-cap
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markets in the United States (a “Competitor”); provided that it shall not be a
violation of this Section 11(b) for the Executive to provide services to a Competitor so long as
the Executive does not provide services to, or have management or supervisory authority for, on
other than an infrequent and immaterial basis, the portion of the Competitor’s business that
provides investment banking services to the small and/or mid-cap markets in the United States. For
purposes hereof, “Noncompetition Period” shall mean the Employment Period and, unless the
Employment Period is terminated by the Company without Cause or by the Executive for Good Reason,
the twelve-month period following the end of the Employment Period. Notwithstanding the foregoing,
if any court determines that the covenant not to compete, or any part thereof, is unenforceable
because of the duration of such provision or the geographic area or scope covered thereby, such
court shall have the power to reduce the duration, area or scope of such provisions and, in its
reduced form, such provision shall then be enforceable and shall be enforced.
(c) Nonsolicitation. During the Employment Period and for the twelve-month period
following the end of the Employment Period, the Executive shall not, directly or indirectly,
without the express written consent of the Company, solicit any person who is or shall be in the
employ or service of the Company to leave such employ or service for any other employment
opportunity.
(d) Work Product. All documents, data, recordings, or other property, whether tangible
or intangible, including all information stored in electronic form, obtained or prepared by or for
the Executive and utilized by the Executive in the course of the Executive’s employment with the
Company Group shall remain the exclusive property of the Company. The Executive shall return such
property that is in the Executive’s possession or control promptly after receipt of a written
request from the Company and, in any event, upon the Executive’s termination of employment for any
reason. The results and proceeds of the Executive’s services to the Company Group hereunder,
including, without limitation, any works of authorship related to the Company resulting from the
Executive’s services during the Executive’s employment with the Company and/or any of its
affiliates and any works in progress, shall be works-made-for-hire and the Company shall be deemed
the sole owner throughout the universe of any and all rights of whatsoever nature therein, whether
or not now or hereafter known, existing, contemplated, recognized or developed, with the right to
use the same in perpetuity in any manner the Company determines in its sole discretion without any
further payment to the Executive whatsoever. If, for any reason, any of such results and proceeds
shall not legally be a work-for-hire and/or there are any rights which do not accrue to the Company
under the preceding sentence, then the Executive hereby irrevocably assign and agree to assign any
and all of the Executive’s right, title and interest thereto, including, without limitation, any
and all copyrights, patents, trade secrets, trademarks and/or other rights of whatsoever nature
therein, whether or not now or hereafter known, existing, contemplated, recognized or developed to
the Company, and the Company shall have the right to use the same in perpetuity throughout the
universe in any manner the Company determines without any further payment to the Executive
whatsoever. The Executive shall, from time to time, as may be requested by the Company and at the
Company’s sole expense, do any and all things which the Company may deem useful or desirable to
establish or document the Company’s exclusive ownership of any an all rights in any such results
and proceeds, including, without limitation, the execution of appropriate copyright and/or patent
applications or assignments. To the extent the Executive have any rights in the results and
proceeds of the Executive’s services to the Company that cannot be assigned in the manner
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described above, the Executive unconditionally and irrevocably waive the enforcement of such
rights. This Section 11(d) is subject to, and shall not be deemed to limit, restrict or constitute
any waiver by the Company of any rights of ownership to which the Company may be entitled by
operation of law by virtue of the Company or any of its affiliates being the Executive’s employer.
(e) Specific Performance. Recognizing the irreparable damage will result to the
Company in the event of the breach or threatened breach of any of the foregoing covenants, and that
the Company’s remedies at law for any such breach or threatened breach will be inadequate, the
Company, in addition to such other remedies which may be available to them, shall be entitled to an
injunction, including a mandatory injunction, to be issued by any court of competent jurisdiction
ordering compliance with this Agreement or enjoining and restraining the Executive from the
continuation of such breach. The Executive acknowledges the importance to the Company of the
provisions of this Section 11 and agrees that he shall not at any time contest the reasonableness
of these provisions or otherwise claim that such provisions are not enforceable under applicable
law.
| 12. | Successors |
(a) This Agreement shall be binding upon and shall inure to the benefit of the Company,
its successors and any person, firm, corporation or other entity which succeeds to all or
substantially all of the business, assets or property of the Company. The Company will require any
successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business, assets or property of the Company, to expressly assume and agree
to perform this Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place. As used in this Agreement, the
“Company” shall mean the Company as hereinbefore defined and any successor to its business, assets
or property as aforesaid which executes and delivers an agreement provided for in this Section 12
or which otherwise becomes bound by all the terms and provisions of this Agreement by operation of
law. This Agreement shall not be assignable by the Company (other than to a successor by merger,
consolidation or purchase) without the prior written consent of the Executive.
(b) This Agreement and all rights of the Executive hereunder shall inure to the benefit of and
be enforceable by the Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If the Executive should die while any
amounts are due and payable to him hereunder, all such amounts, unless otherwise provided herein,
shall be paid to the Executive’s designated beneficiary or, if there be no such designated
beneficiary, to the legal representatives of the Executive’s estate. This Agreement shall not be
assignable by the Executive.
| 13. | Entire Agreement |
This Agreement contains the entire understanding of the parties with respect to the subject
matter hereof and, except as specifically provided herein, cancels and supersedes any and all other
agreements between the parties with respect to the subject matter hereof. Any
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amendment or modification of this Agreement shall not be binding unless in writing and signed by
the Company and the Executive.
| 14. | Severability |
In the event that any provision of this Agreement is determined to be invalid or
unenforceable, the remaining terms and conditions of this Agreement shall be unaffected and shall
remain in full force and effect, and any such determination of invalidity or unenforceability shall
not affect the validity or enforceability of any other provision of this Agreement.
| 15. | Notices |
All notices which may be necessary or proper for either the Company or the Executive to give
to the other shall be in writing and shall be deemed given (i) when personally delivered to the
recipient (provided a written acknowledgement of receipt is obtained), (ii) one (1) business day
after being sent by a nationally recognized overnight courier (provided that a written
acknowledgement of receipt is obtained by the overnight courier) or (iii) four (4) business days
after mailing by certified or registered mail, postage prepaid, return receipt requested, to the
Executive at the address on record with the Company, and shall be sent in the manner described
above to the Secretary of the Company at the Company’s principal executives offices or delivered by
hand to the Secretary of the Company.
| 16. | Governing Law |
This Agreement shall be governed by and enforceable in accordance with the laws of the State
of New York, without giving effect to the principles of conflict of laws thereof.
| 17. | Arbitration |
Any controversy or claim arising out of, or related to, this Agreement, or the breach thereof,
shall be settled by binding arbitration in the City of New York, New York, in accordance with the
rules then obtaining of the American Arbitration Association, and the arbitrator’s decision shall
be binding and final, and judgment upon the award rendered may be entered in any court having
jurisdiction thereof.
| 18. | Indemnification |
The Company shall indemnify and hold harmless the Executive to the fullest extent permitted by
applicable law or the Company’s by-laws and certificate of incorporation for any action or inaction
of the Executive while serving as an officer or director of the Company. In addition, the Company
shall cover the Executive under directors’ and officers’ liability insurance both during and, while
potential liability exists, after the term of employment in the same amount and to the same extent
as the Company covers its other officers and directors.
| 19. | Legal Fees and Expenses |
The parties agree that in the event of any claim regarding this Agreement or the Executive’s
performance of services for the Company, each party shall bear its own costs and
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expenses incurred in connection with such claim. The Company agrees to pay all attorneys’
fees and expense incurred by the Executive in connection with entering into this Agreement, subject
to a maximum amount of $50,000.
IN WITNESS WHEREOF, the Company and the Executive have executed this Agreement as of the date
first above written.
| EXECUTIVE | ||
| /s/ Xxxxx XxXxxxxxx | ||
| Xxxxx XxXxxxxxx | ||
| FIRST ALBANY COMPANIES INC. | ||
| /s/ Xxxx Xxxxxxxx | ||
| By: Xxxx Xxxxxxxx | ||
| Title: Vice Chairman of the Board |
