SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 20, 2005
(December 20, 2005)
TrustCo Bank Corp NY
(Exact name of registrant as specified in its charter)
New York
(State or other jurisdiction of incorporation)
0-10592 14-1630287
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(Commission File Number) (IRS Employer Identification No.)
5 Sarnowski Drive, Glenville, New York 12302
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (518) 377-3311
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TrustCo Bank Corp NY
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
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The TrustCo Bank Corp NY (Nasdaq: TRST) (the "Company") Board of Directors
approved the accelerated vesting of all currently outstanding unvested stock
options ("Options") to purchase shares of common stock of TrustCo. These
options were previously awarded to executive officers and employees under its
1995 and 2004 Stock Option Plans. By accelerating the vesting of these Options,
the Company estimates that approximately $1.3 million of future compensation
expense, net of taxes, will be eliminated.
Options to purchase 882,100 shares of the Company's common stock, which would
otherwise have vested from time to time over the next four years, became
immediately exercisable as a result of this action. The number of shares and
exercise prices of the Options subject to the acceleration are unchanged. The
remaining terms for each of the Options granted remain the same. The
acceleration is effective as of December 20, 2005. The Company will seek
consent from options holders of incentive stock options within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended, if the
acceleration would have the effect of changing the status of the option for
federal income tax purposes from an incentive stock option to a non-qualified
stock option.
The accelerated Options included 749,500 Options held by executive officers and
132,600 Options held by other employees. Based on the Company's closing stock
price of $12.76 price per share on the date of accelerated vesting, certain of
the total accelerated Options have exercise prices below or above the closing
market price at the time of acceleration. The accelerated Options have exercise
prices as follows :
Grant Accelerated Exercise
Date Vesting Shares Price
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2005 411,200 $12.15
2004 394,500 $13.55
2002 76,400 $11.83
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882,100
The decision to accelerate the vesting of these options, which the Company
believes is in the best interest of its stockholders, was made primarily to
reduce non-cash compensation expense that would have been recorded in its
income statement in future periods upon the adoption of Financial Accounting
Standards Board Statement No. 123R (Share-Based Payment) in January 2006.
Assuming that no holders of incentive stock options withhold consent for the
acceleration, the Company estimated that approximately $1.3 million of future
compensation expense, net of taxes, will be eliminated as a result of the
acceleration of vesting. Should any of the option holders withhold consent for
the vesting acceleration, then the Company would incur future expense
associated with those Options over the remainder of the Options' original
vesting schedule as of January 1, 2006 and the current estimated expense
elimination for the Company would be reduced. Since the Company currently
accounts for its stock options in accordance with Accounting Principles Board
Opinion No. 25, Accounting for Stock Issued to Employees ("APB No. 25"), it
will report compensation expense related to the affected options for disclosure
purposes only in its fourth quarter 2005 financial statements in accordance
with Financial Accounting Standards Board Statement No. 123 (Accounting for
Stock-Based Compensation).
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: December 20, 2005
TrustCo Bank Corp NY
(Registrant)
By:/s/ Robert T. Cushing
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Robert T. Cushing
Executive Vice President and
Chief Financial Officer
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