Exhibit 4.1
FIRST EMPIRE STATE CORPORATION
DEFERRED BONUS PLAN
(Amended and Restated effective January 1, 1998)
ARTICLE I
INTENT
This First Empire State Corporation Deferred Bonus Plan was
established, effective January 1, 1984, for the benefit of certain
employees of certain affiliates of First Empire State Corporation.
The Plan is intended to qualify as a plan described in Section 201(2)
of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), and is maintained primarily for the purpose of providing
deferred compensation for a select group of management or highly
compensated employees.
ARTICLE II
DEFINITIONS
When used in this Plan, the following terms shall have the
following meanings:
2.1 "Account" means the account maintained for a Participant
pursuant to Article IV hereof.
2.2 "Beneficiary" means the person or persons designated by a
Participant pursuant to Article VI hereof to receive any benefit
payable pursuant to Section 5.1 hereof upon the Participant's death.
2.3 "Bank" means Manufacturers and Traders Trust Company and
its successors by merger, sale of assets or otherwise.
2.4 "Board" means the board of directors of First
Empire State Corporation.
2.5 "Bonus" means an Eligible Employee's award under
an Incentive Plan.
2.6 "Deemed Earnings" means the income earned or loss incurred
with respect to a Participant's Deemed Investment Portfolio. The
Deemed Earnings with respect to each investment option in a Deemed
Investment Portfolio shall be determined on the basis of the total
actual return on such investment option in the First Empire State
Corporation Retirement Savings Plan for the period in question or, in
the
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case of a First Empire Stock Deemed Investment Account, on the basis
of the number of shares of First Empire Common Stock that would
represent reinvested dividends on the shares credited to such First
Empire Stock Deemed Investment Account
for the period in question.
2.7 "Deemed Investment Portfolio" means the hypothetical
portfolio designated by a Participant from among (a) the investment
options offered under the First Empire State Corporation Retirement
Savings Plan, excluding the First Empire State Corporation Stock Fund
offered thereunder, and (b) shares of First Empire Common Stock.
2.8 "Deferred Bonus Election" means an election made pursuant
to Section 3.1(a) hereof.
2.9 "Deferred Bonus" means that portion of a Bonus the payment
of which is deferred by a Participant under this Plan.
2.10 "Deferred Bonus Agreement" means the written agreement
entered into between a Participant and his Employer pursuant to which
the Participant elects to defer payment of a specified portion of his
Bonus in accordance with the terms of this Plan and such agreement.
2.11 "Eligible Employee" means an individual who is an
employee of an Employer, who is eligible to participate in an
Incentive Plan and who is designated by the Plan Administrator as
eligible to participate in this Plan.
2.12 "Employer" means First Empire State Corporation and each
of its affiliates, any of whose employees are eligible to participate
in an Incentive Plan.
2.13 "Financial Hardship" means a financial hardship
of a Participant.
2.14 "First Empire Common Stock" means the Common
Stock, par value $5.00 per share, of First Empire State
Corporation.
2.15 "First Empire Stock Deemed Investment Account" means that
portion of an Account consisting of hypothetical shares of First
Empire Common Stock.
2.16 "Incentive Plan" means the First Empire State Corporation
Incentive Plan and such other incentive plans of First Empire State
Corporation or its subsidiaries as the Plan Administrator may
designate.
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2.17 "Participant" means an Eligible Employee who has deferred
a portion of his Bonus pursuant to a Deferred Compensation Agreement
and the terms of this Plan.
2.18 "Plan" means this First Empire State Corporation Deferred
Bonus Plan, as set forth herein and amended from time to time.
2.19 "Plan Administrator" means such person or committee as
may be designated by the Board to serve as such under this Plan.
2.20 "Retirement" means the earliest of a Participant's (a)
normal retirement, early retirement or disability retirement under
the First Empire State Corporation Retirement Plan, (b) death or (c)
65th birthday.
2.21 "Revaluation Date" means the last day of each calendar
quarter and such other dates as may be designated by the Plan
Administrator.
ARTICLE III
DEFERRAL OF BONUS
3.1 Deferred Bonus Elections.
(a) An Eligible Employee, by executing a Deferred Bonus
Agreement, may elect to defer all or any portion of his Bonus.
(b) An Eligible Employee must make his Deferral Election
for a Bonus payable with respect to a calendar year on or before
October 31 of that calendar year.
3.2 Deferred Bonus Agreements.
(a) A Deferred Bonus Election pursuant to this Plan shall
be made pursuant to a written Deferred Bonus Agreement between the
Eligible Employee and his Employer.
(b) A Participant's Deferred Bonus Agreement shall
specify whether the Deferred Bonus thereunder (and Deemed Earnings
thereon) shall be paid in a single lump-sum payment or in annual
installments payable over five, ten or 20 years.
(c) A Participant's Deferred Bonus Agreement shall
specify whether the Deferred Bonus thereunder (and Deemed Earnings
thereon) shall be paid (or shall commence to
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be paid) at (i) Retirement or (ii) on a date selected by the
Participant from among any one of the first 20 anniversaries of the
date on which the Deferred Bonus would have been paid absent the
Deferred Bonus Election.
ARTICLE IV
ACCOUNTS
4.1 Maintenance of Accounts. The Plan Administrator shall
establish a bookkeeping account (an "Account") for each Participant.
As of the first day of the month in which a Deferred Bonus would have
been paid to the Participant absent a Deferred Bonus Election, the
amount of such Deferred Bonus shall be credited to such Participant's
Account.
4.2 Deemed Earnings. As of each Revaluation Date, a
Participant's Account shall be adjusted for Deemed Earnings since the
preceding Revaluation Date. Where a Deferred Bonus is credited to an
Account other than on a Revaluation Date, Deemed Earnings on the
amount of such Deferred Bonus for the period from the date of such
credit until the next succeeding Revaluation Date shall be a pro rata
portion of Deemed Earnings on an equivalent amount for the period
between the Revaluation Dates immediately preceding and succeeding
the date of such credit, calculated by reference to the number of
days in each period, except that Deemed Earnings on a First Empire
Stock Deemed Investment Account shall be based on the actual dates of
dividend payments on First Empire Common Stock.
4.3 Deemed Investment Portfolio. In his Deferred Bonus
Agreement, a Participant shall designate a Deemed Investment
Portfolio, and shall allocate his Deferred Bonus among the investment
options offered for inclusion in the Deemed Investment Portfolio in
integral multiples of 5 percent. A Participant may change such
allocation on a calendar quarterly basis by submitting a written form
to the Plan Administrator prior to the first day of such calendar
quarter; provided, however, that a Participant may not change a prior
allocation to his First Empire Stock Deemed Investment Account other
than to add to such Account.
4.4 Separate Accounting. Within a Participant's
Account, the Plan Administrator shall account separately for
each of the Participant's Deferred Bonuses.
4.5 First Empire Stock Deemed Investment Account. A
Participant's First Empire Stock Deemed Investment Account
shall be credited with the number of hypothetical shares of
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First Empire Common Stock that equals the portion of the Deferred
Bonus as to which the Participant elected a hypothetical investment
in such shares, divided by the closing price of a share of First
Empire Common Stock on the American Stock Exchange (or such other
principal securities exchange on which the shares of Common Stock are
traded if such shares are no longer traded on the American Stock
Exchange) on the effective date of the deferral, which shall be the
date on which the Deferred Bonus would have been paid had it not been
deferred, plus Deemed Earnings thereon. In the event of any change in
corporate capital capitalization, such as a stock split, or a
corporate transaction, such as any merger, consolidation, separation,
including a spin-off, or other distribution of stock or property of
the Employer, any reorganization (whether or not such reorganization
comes within the definition of such term in Internal Revenue Code
Section 368) or any partial or complete liquidation of the Employer,
such adjustment shall be made in the number and class of hypothetical
shares of First Empire Common Stock held in a Participant's First
Empire Stock Deemed Investment Account as may be determined to be
appropriate and equitable by the Plan Administrator in its sole
discretion.
ARTICLE V
PAYMENT OF BENEFITS
5.1 General Rule. Except as provided in the following sentence
or in Section 5.2 hereof, a Participant (or, in the event of the
Participant's death, his Beneficiary) shall receive (or begin to
receive) payment of the amount standing to the Participant's Account
as of the Revaluation Date or Dates next following the time or times
elected in the Participant's Deferred Bonus Agreement or Agreements
and shall receive such payment or payments in the form or forms
elected in such Agreement or Agreements. If, however, a Participant
terminates his employment with the Employer for any reason other than
Retirement, the Plan Administrator, in its discretion, may direct
that, rather than payment pursuant to the preceding sentence, a
single payment shall be made of the amount standing to the
Participant's Account as of any earlier Revaluation Date.
5.2 Hardship Withdrawals. In the event of Financial
Hardship, a Participant may request a distribution of all or a
portion of the amount standing to his Account. The
determination of whether a Participant has incurred a
Financial Hardship shall be made by the Plan Administrator.
The Participant shall determine against which Deferred Bonus
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or Bonuses (and Deemed Earnings thereon) a withdrawal pursuant to
this Section 5.2 shall be charged.
5.3 Payment. The payment to a Participant with respect to a
Deferred Bonus (and Deemed Earnings thereon) shall be made in cash by
the Participant's last Employer in the year with respect to which the
Bonus deferred was payable; provided, however, that (a) if such
Employer is owned directly or indirectly by a bank, the payment shall
be made by such bank and (b) payment from a Participant's First
Empire Stock Deemed Investment Account shall be made in First Empire
Common Stock (except to the extent that payment in First Empire
Common Stock would result in a fractional share, in which case the
amount that would constitute a fractional share shall be paid in
cash, based on the closing price of a share of First Empire Common
Stock on the American Stock Exchange, or such other principal
securities exchange on which the shares of Common Stock are traded if
such shares are no longer traded on the American Stock Exchange, on
the Revaluation Date immediately preceding the date of payment).
Payments of a Participant Account which (x) is not being paid in a
single payment and (y) contains a First Empire Stock Deemed
Investment Account as well as other amounts in the Account, shall be
made in both cash and First Empire Common Stock pro rata in
accordance with the values of the Participant's First Empire Stock
Deemed Investment Account and the balance of the Participant's
Account.
5.4 Tax Withholding. The Plan Administrator may make such
provisions and take such steps as it may deem necessary or
appropriate for the withholding by the Employers of all Federal,
state, local or other taxes required by law to be withheld with
respect to deferrals and payments under this Plan, including, without
limitation, in the discretion of the Plan Administrator, (a)
requiring the Participant (or Beneficiary, as the case may be) to
pay, or provide for payment of, the amount of any such taxes, (b)
deducting any such taxes from any amount otherwise payable to the
Participant or Beneficiary in cash, including amounts payable under
this Plan, or (c) reducing the number of shares of First Empire
Common Stock otherwise payable under this Plan by an amount (based on
the closing price of such shares on the Revaluation Date immediately
preceding the date the shares would otherwise have been paid) equal
to the amount of any such taxes.
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ARTICLE VI
BENEFICIARIES
Each Participant may designate from time to time any person or
persons, natural or otherwise, as his Beneficiary or Beneficiaries to
whom benefits under Section 5.1 are to be paid in the event of his
death. Each Beneficiary designation shall be made either in the
Deferred Bonus Agreement or on a form provided by the Plan
Administrator and shall be effective only when filed with the Plan
Administrator during the Participant's lifetime. Each Beneficiary
designation filed with the Plan Administrator shall revoke all
Beneficiary designations previously made by the Participant. The
revocation of a Beneficiary designation shall not require the consent
of any designated Beneficiary. Payment to a Beneficiary shall be made
in the form or forms elected in the Participant's Deferred Bonus
Agreement or Agreements, provided that such payment shall be made in
a single payment if a request for such a single payment is made by
the Beneficiary and approved by the Plan Administrator.
ARTICLE VII
ADMINISTRATION
7.1 General. The Plan Administrator shall be charged with the
administration of this Plan. The Plan Administrator shall have all
such powers as may be necessary to discharge its duties relative to
the administration of this Plan, including by way of illustration and
not limitation, discretionary authority to interpret and construe
this Plan, to decide any dispute arising hereunder, to determine the
right of any individual with respect to participation herein, to
determine the right of any Participant with respect to benefits
payable under this Plan and to adopt, alter and repeal such
administrative rules, regulations and practices governing the
operation of this Plan as it, in its sole discretion, may from time
to time deem advisable. The Plan Administrator shall not be liable to
any person for any action taken or omitted in connection with the
interpretation and administration of this Plan unless attributable to
willful misconduct or lack of good faith. The Plan Administrator
shall be entitled to rely conclusively upon all tables, valuations,
certificates, opinions and reports furnished by any actuary,
accountant, controller, counsel or other person employed or engaged
by the Plan Administrator or an Employer with respect to this Plan.
The Plan Administrator, if an individual, or the members thereof if
the Plan Administrator
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is a Committee, shall not participate in any action or determination
regarding solely his or their own benefits payable hereunder. Except
as provided in Section 7.3 hereof, decisions of the Plan
Administrator made in good faith shall be final, conclusive and
binding upon all parties.
7.2 Claims Procedure. Whenever the Plan Administrator denies,
in whole or in part, a claim for benefits filed by any person
(hereinafter referred to as a "Claimant"), the Plan Administrator
shall transmit a written notice setting forth, in a manner calculated
to be understood by the Claimant, a statement of the specific reasons
for the denial of the claim, references to the specific provisions of
this Plan on which the denial is based, a description of any
additional needed material or information and why such material or
information is necessary, and an explanation of the claims review
procedure as set forth herein. In addition, the written notice shall
contain the date on which the notice was sent and a statement
advising the Claimant that, within 90 days of the date on which such
notice is received, he may obtain review of the Plan Administrator's
decision.
7.3 Review Procedure. Within 90 days of the date on which the
notice of denial of claim is received by the Claimant, the Claimant
or his authorized representative may request that the claim denial be
reviewed by filing with the Plan Administrator a written request
therefor, which request shall contain the following information:
(a) the date on which the notice of denial of
claim was received by the Claimant;
(b) the date on which the Claimant's request was filed
with the Plan Administrator; provided, however, that the date on
which the Claimant's request for review was in fact filed with the
Plan Administrator shall control in the event that the date of the
actual filing is later than the date stated by the Claimant pursuant
to this clause (b);
(c) the specific portions of the denial of his
claim which the Claimant requests the Plan Administrator to
review;
(d) a statement by the Claimant setting forth the basis
upon which he believes the Plan Administrator should reverse its
previous denial of his claim for benefits and accept his claim as
made; and
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(e) any written material (included as exhibits) which the
Claimant desires the Plan Administrator to examine in its
consideration of his position as stated pursuant to clause (d).
Within 60 days of the date determined pursuant to clause (b)
(or, if special circumstances require an extension of time, within
120 days of such date), the Plan Administrator shall conduct a full
and fair review of the decision denying the Claimant's claim for
benefits and shall deliver, to the Claimant in writing, its decision.
Such written decision shall set forth, in a manner calculated to be
understood by the Claimant, a statement of the specific reasons for
the decision, including references to the specific provisions of this
Plan which were relied upon. The decision will be final and binding
on all persons concerned.
ARTICLE VIII
AMENDMENT AND TERMINATION
8.1 Power to Amend or Terminate. First Empire State
Corporation expects to continue this Plan indefinitely, but reserves
the right to amend or terminate this Plan at any time, if, in its
sole judgment, such amendment or termination is necessary or
desirable. Any such amendment or termination shall be made in writing
by the Board or its designee, if applicable, and shall be effective
as of the date specified in such document. No amendment or
termination of this Plan shall directly or indirectly deprive any
Participant or Beneficiary of all or any portion of the amounts
previously credited to the Participant's Account. In the event of a
termination of this Plan, First Empire State Corporation (or any
transferee, purchaser or successor entity) may elect, in its
discretion, either to have the Employers make a single payment, at
the time of such termination, of the Account balances on such date to
Participants and Beneficiaries or to have the Employers make payments
to such individuals at such time or times as provided under the terms
of this Plan.
8.2 Successor. This Plan shall not be automatically terminated
by a transfer or sale of an Employer or by the merger or
consolidation of an Employer into or with any other corporation or
other entity, but it shall be continued with respect to such Employer
or its successor after such sale, merger or consolidation only if and
to the extent that the transferee, purchaser or successor entity
agrees to continue this Plan. In the event this Plan is not continued
with respect to such Employer or its successor by the transferee,
purchaser or successor entity, then it shall terminate with
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respect to such Employer or its successor subject to the
provisions of Section 8.1 hereof.
ARTICLE IX
MISCELLANEOUS
9.1 No Effect on Employment Rights. Nothing contained herein
will confer upon any Participant the right to be retained in the
service of an Employer nor limit the right of an Employer to
discharge or otherwise deal with Participants without regard to the
existence of this Plan.
9.2 Plan Unfunded. Notwithstanding any provision herein to the
contrary, the benefits offered hereunder shall constitute nothing
more than unfunded, unsecured promises by each Employer to pay the
amounts that such Employer is obligated to pay under this Plan. No
provision shall at any time be made with respect to segregating any
assets of any Employer for payment of any amounts hereunder. No
Participant, Beneficiary or any other person shall have any interest
in any particular assets of the Employers by reason of the right to
receive a benefit under this Plan, and any such Participant,
Beneficiary or other person shall have only the rights of a general
unsecured creditor of the Employer obligated to make payments to the
Participant under this Plan. Nothing contained in this Plan shall
constitute a guaranty by the Employers or any other entity or person
that the assets of any Employer will be sufficient to pay any amount
hereunder. All expenses and fees incurred in the administration of
this Plan shall be paid by the Employers.
9.3 Binding on Employers, Employees and Their Successors. This
Plan shall be binding upon and inure to the benefit of the Employers,
their successors and assigns and each Participant and his heirs,
executors, administrators and legal representatives. In the event of
the merger or consolidation of an Employer with or into any other
corporation, or in the event substantially all of the assets of an
Employer shall be transferred to another corporation, the successor
corporation resulting from the merger or consolidation, or the
transferee of such assets, as the case may be, shall, as a condition
to the consummation of the merger, consolidation or sale, assume the
obligations of such Employer hereunder as of the date of such merger,
consolidation or transfer and shall be substituted for such Employer
hereunder.
9.4 Spendthrift Provisions. No amount payable under
this Plan shall be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance or
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charge prior to actual receipt thereof by the payee; and any attempt
so to anticipate, alienate, sell, transfer, assign, pledge, encumber
or charge prior to such receipt shall be void; and the Employers
shall not be liable in any manner for or subject to the debts,
contracts, liabilities, torts or engagements of any person entitled
to any benefit under this Plan.
9.5 Disclosure. Each Participant shall receive a copy of this
Plan, and the Plan Administrator will make available for inspection
by any Participant a copy of the rules and regulations used by the
Plan Administrator in administering this Plan.
9.6 State Law. This Plan is established under and
will be construed according to the laws of the State of New
York to the extent that such laws are not preempted by ERISA.
9.7 Incapacity of Recipient. In the event a Participant or
Beneficiary is declared incompetent and a guardian, conservator or
other person legally charged with the care of his person or of his
estate is appointed, any amounts to which such Participant or
Beneficiary is entitled under this Plan shall be paid to such
guardian, conservator or other person legally charged with the care
of his person or his estate. Except as provided herein, when the Plan
Administrator, in its sole discretion, determines that a Participant
or Beneficiary is unable to manage his financial affairs, the Plan
Administrator may direct the Employer, or Employers responsible for
payment to make payments to any person for the benefit of such
Participant or Beneficiary.
9.8 Unclaimed Benefit. Each Participant shall keep the Plan
Administrator informed of his current address. The Plan Administrator
shall not be obligated to search for the whereabouts of any person.
If the location of a Participant is not made known to the Plan
Administrator within three years after the date on which any payment
of the Participant's benefit hereunder may be made, payment may be
made as though the Participant had died at the end of the three-year
period. If, within one additional year after such three-year period
has elapsed, or, within three years after the actual death of a
Participant, whichever occurs first, the Plan Administrator is unable
to locate the Beneficiary of the Participant, the Participant and his
Beneficiary shall forfeit all rights to any payments under this Plan.
9.9 Elections, Applications, Notices. Every
direction, revocation or notice authorized or required
hereunder shall be deemed delivered to the Employers or the
Plan Administrator as the case may be: (a) on the date it is
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personally delivered to the Plan Administrator (with a copy to the
Bank's General Counsel) at the Bank's executive offices at Buffalo,
New York or (b) three business days after it is sent by registered or
certified mail, postage prepaid, addressed to the Plan Administrator
(with a copy to the Bank's General Counsel) at the offices indicated
above, and shall be deemed delivered to a Participant or Beneficiary:
(a) on the date it is personally delivered to such individual, or (b)
three business days after it is sent by registered or certified mail,
postage prepaid, addressed to such individual at the last address
shown for him on the records of the Employers. Any notice required
hereunder may be waived by the person entitled thereto.
9.10 Severability. In the event any provision of this Plan
shall be held illegal or invalid for any reason, such illegality or
invalidity shall not affect the remaining provisions of this Plan.
This Plan shall be construed and enforced as if such illegal or
invalid provision had never been contained herein.
9.11 Headings. The headings of Sections of this Plan are for
convenience of reference only and shall have no substantive effect on
the provisions of this Plan.