ex10-1.htm


    Exhibit
10.1

    
       

      Gyrodyne
Company of America, Inc.

      Amended
and Restated

      Incentive
Compensation Plan

      As
of February 2, 2010


      


      Gyrodyne
Company of America, Inc., a corporation organized under the laws of the State of
New York, hereby amends and restates its Incentive Compensation Plan, originally
adopted on June 25, 1999.

      


      
        	
                1.

              	
                Definitions.

              


      

       

      (a)           “Administrative
Committee” means the Board of Directors of the Company, unless the Board shall
elect from among its members a committee to administer the Plan.

       

      (b)           “Base
Date FMV” means (A) for Participants who became such on or prior to December 31,
2009, $15.3875, and (B) for any Participant who became such following December
31, 2009, the average closing market price of the Common Stock on the Nasdaq
Stock Market for the ten trading days ending on the trading day prior to the
date such Participant became such.

       

      (c)           “Board”
means the Board of Directors of the Company.

       

      (d)           “Change
in Control” means (i) a tender offer or exchange offer made and consummated for
ownership of Common Stock representing 30% or more of the combined voting power
of the Company’s outstanding securities; (ii) one or more sales or transfers by
the Company during the twelve-month period ending on the date of the most recent
transfer of assets having a total gross fair market value equal to or more than
90% of the total gross fair market value of all of the assets of the Company
immediately before such transfer or transfers; or (iii)  any merger,
share exchange or consolidation of the Company with another entity other than a
merger where the Company’s shareholders immediately before the merger own
immediately following the merger at least 70% of the combined voting power of
the Company’s outstanding securities, and, in each case, such transaction is not
consummated with a “Related Person” to the Company, as such term is defined in
Section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”).

       

      (e)           “Closing
Date FMV” shall mean (i) in the event a Change in Control is effected by a cash
purchase of Common Stock, the price per share paid by the acquirer; (ii) in the
event a Change in Control is effected with consideration other than cash or
involving the sale of Company assets, the per share value to the target
shareholders of the transaction as determined by an investment banking firm selected by the Company;
provided, however, that for purposes of calculating an Incentive Compensation
Payment with respect to a Payment Event for a Participant who is no longer an
employee or member of the Board on the date of such Payment Event, Closing Date
FMV shall be the lesser of (A) the amount determined in clauses (i) or (ii)
above, or (B) the average closing market price of the Common Stock on the Nasdaq
Stock Market for the ten trading days ending on the trading day prior to the
date of departure of the withdrawn Participant.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (f)           “Common
Stock” means shares of the common stock of the Company.

       

      (g)           “Company”
means Gyrodyne Company of America, Inc.

       

      (h)           
“Establishment Date” means June 25, 1999.

       

      (i)           “ICR
Pool” means, for each Participant, an amount equal to the product of (x)
Closing Date FMV minus Base Date FMV for such Participant and (y) the number of
ICR Units in the Plan determined in accordance with Sections 6 and 12
hereof.

       

      (j)           “ICR
Unit” means the unit used under the Plan to compute the incentive compensation
to be paid to Participants  and which is equivalent to one share of
Common Stock for the purposes of this Plan and for no other
purpose.

       

      (k)           “Incentive
Compensation Payments” means the payments to be made to
Participants.

       

      (l)           “Incentive
Compensation Rights” or “ICRs” are the rights created under the terms of the
Plan.

       

      (m)           “Other
Eligible Employee” means any individual who is employed by the Company and who
is not the President, the Executive Vice-President, or a Vice President of the
Company or an Other Management Employee.

       

      (n)           “Other
Management Employee” means any management employee of the Company who is not the
President, the Executive Vice President or a Vice President of the
Company.

       

      (o)           “Participant”
means any individual who has been granted ICRs by the Administrative
Committee.

       

      (p)           “Payment
Event” means a Change in Control or an Excess Dividend.

       

      (q)           “Plan”
means this Incentive Compensation Plan.

       

      
        	
                2.

              	
                Purpose.

              


      

       

      The
purpose of the Plan is to promote the shareholder point of view among employees
and members of the Board and encourage Participants to support a Change in
Control and/or asset dispositions followed by cash distributions, in each case
that would maximize shareholder value.

      


      
        	
                3.

              	
                Eligibility.

              


      

       

      All
employees of the Company and all members of the Board are eligible to be
approved for ICR grants under the terms of the Plan.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
        	
                4.

              	
                Granting of
      ICRs.

              


      

       

      The
Administrative Committee has, effective June 25, 1999, awarded ICRs to all
employees having at least one year of employment with the Company, and all
members of the Board on that date.

      


      Employees
and members of the Board assuming positions described in Section 5(c) below
after June 25, 1999 may be granted ICRs by majority vote of the Administrative
Committee.

      


      
        	
                5.

              	
                Incentive Compensation
      Payments.

              


      

       

      Participants
will be entitled to receive Incentive Compensation Payments under the following
circumstances:

       

      (a)           Change in
Control.  In the event of a Change in Control, Incentive
Compensation Payments shall be calculated in accordance with the percentage
weights set forth in (c) below and subject to the provisions of such
sub-section, and shall be paid to Participants (A) within 10 days after the
consummation of a Change in Control with respect to transactions referred to in
clauses (i) or (iii) of the definition of Change in Control herein, or (B) in
proportion to and contemporaneously with payments received by the Company in
transactions referred to in clause (ii) of such definition.  Upon
payment in full of the Incentive Compensation Payments hereunder, all
outstanding ICRs shall be canceled and no further payments shall be made to
Participants under the Plan.

       

      (b)           Dividend Distribution From
Asset Disposition.  If the Company receives proceeds from the
disposition of assets during any twelve-month period in an aggregate dollar
amount greater than or equal to 15% of the total gross fair market value of all
the assets of the Company immediately before such disposition or dispositions,
and within twelve months following such last disposition the Company pays a
dividend to the shareholders in excess of the income from operations (“Excess
Dividend”), then there shall be an allocation and payment to the Participants
equal, in the aggregate, to the product of the Excess Dividend per share paid
and the number of ICR Units in the Plan (the “Disposition
Dividend”).  Notwithstanding the foregoing, the amount of the
Disposition Dividend may not exceed the aggregate amount of Incentive
Compensation Payments that would have been paid pursuant to Section 5(a) had
there been a Change in Control consummated on the date of the payment of the
Excess Dividend.

       

      
        An
individual Participant’s share of the Disposition Dividend will equal (x) the
Disposition Dividend, multiplied by (y) a fraction, the numerator of which is
the Participant’s Incentive Compensation Payment that would be paid if a Change
in Control were consummated on the date of the payment of the Excess Dividend,
and the denominator of which is the total dollar amount that would be paid to
all Participants if a Change in Control were consummated on the date of the
payment of the Excess Dividend.  For illustrative purposes only, if a
Disposition Dividend equals $1,000,000 and a hypothetical Change in Control
consummated on that date would result in a total payment to Participants of
$4,400,000 and an individual Incentive Compensation Payment to such Participant
is equal to $440,000, then the Participant would receive an Incentive
Compensation Payment equal to $100,000 ($440,000 divided by $4,400,000
multiplied by $1,000,000).

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (c)           Percentage Weights (as of
February 2, 2010) and Computation of Incentive Compensation
Payments.

       

      
        	
                CLASS

              	
                %
      of

                Total

                by Class

              	
                Participants

                in Class

              	
                Individual

                Participant

                Percentage

                Weight

              
	 
      	 
      	 
      	 
      
	
                1.      President
      & CEO

              	
                18.5

              	
                1

              	
                18.5

              
	
                2.      Executive
      V.P.

              	
                13.5

              	
                1

              	
                13.5

              
	
                3.      V.P.
      & Comptroller

              	
                3.5

              	
                1

              	
                3.5

              
	
                4.      Other
      Mgt. Employees

              	
                7.0

              	
                2

              	
                3.5

              
	
                5.      Other
      Eligible Employees

              	
                1.0

              	
                2

              	
                .5

              
	
                6.      Non-Employee
      Directors

              	
                52.5

              	
                7

              	
                7.5

              
	
                7.      Chairman
      of the Board

              	
                4.0

              	
                1

              	
                4.0

              


      

      


      An
individual Participant’s Incentive Compensation Payment will equal the product
of (x) Individual Participant Percentage Weight and (y) the ICR
Pool.

      


      The
Administrative Committee may not effectuate changes in the percentages set forth
above; provided, however, that the Individual Participant Percentage Weight
shall be subject to adjustment for any increase or decrease in the number of
Participants in such Participant’s class.

      


      The
Individual Participant Percentage Weight for Board members shall be
cumulative.  For example, a Chairman of the Board who held no other
position would have an Individual Participant Percentage Weight of
11.5%.

      


      
        	
                6.

              	
                Number of ICR
      Units.

              


      

       

      Subject
to adjustment under Section 12, the initial number of ICR Units shall be fixed
at 100,000.

       

      
        	
                7.

              	
                Vesting

              


      

       

       All
current Participants shall immediately vest with respect to their Individual
Participant Percentage Weight.


       

      
        	
                8.

              	
                Treatment of
      Payment.

              


      

       

      Incentive
Compensation Payments shall be treated as compensation, and, accordingly, the
Company shall have the right to deduct from any payment to be made pursuant to
this Plan, or to otherwise require direct payment from the
Participant,  of any Federal, state or local taxes as and when such
may be required by law to be withheld or to be paid.

      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
        	
                9.

              	
                Duties of Administrative
      Committee.

              


      

       

      The
Administrative Committee shall award ICRs and administer, construe and interpret
the Plan. No member of the Administrative Committee shall be liable for any act
done or determination made in good faith.  The construction and
interpretation by the Administrative Committee of any provision of this Plan
shall be final and conclusive.

      


      
        	
                10.

              	
                Discontinuance of
      Plan.

              


      

       

      The Board may discontinue the Plan at any time, provided
that such discontinuance shall not affect the right to receive Incentive
Compensation Payments by any Participant with respect to ICRs that vested prior
to the date of discontinuance.

      


      
        	
                11.

              	
                Limitation of
      Rights.

              


      

       

      Nothing
in this Plan shall be construed to:

      


      (a)           Give
any employee or director of the Company any right to be awarded any ICR other
than in the sole discretion of the Administrative Committee;

       

      (b)           Give
a Participant any rights whatsoever with respect to shares of Common
Stock;

       

      (c)           Limit
in any way the right of the Company to terminate a Participant’s employment with
the Company at any time; or

       

      (d)           Be
evidence of any agreement or understanding, expressed or implied, that the
Company will employ a Participant in any particular position or at any
particular rate of remuneration or for any particular period of
time.

       

      
        	
                12.

              	
                Adjustment in Number of ICR
      Units.

              


      

       

      In the
event of any stock dividend on the Common Stock,  any split-up or
combination of shares of the Common Stock, appropriate adjustment shall be made
by the Administrative Committee in the aggregate number of ICR Units which may
be fixed under this Plan.

      


      
        	
                13.

              	
                Nonalienation of
      Benefits.

              


      

       

      No right
or benefit under this Plan shall be subject to anticipation, alienation, sale,
assignment, pledge, encumbrance, or charge, and any attempt to anticipate,
alienate, sell, assign, pledge, encumber, or charge the same shall be
void.  No right or benefit hereunder shall in any manner be liable for
or subject to the debts, contracts, liabilities, or torts of the Participant
entitled to such benefits.

      


       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
        	
                14. 

              	
                Section 409A of the
      Code.

              


      

      


      Although
the Company does not guarantee the particular tax treatment of an ICR granted
under this Plan, ICRs granted under this Plan are intended to comply with, or be
exempt from, the applicable requirements of Section 409A of the Code and this
Plan and any ICR hereunder shall be limited, construed and interpreted in
accordance with such intent. In no event whatsoever shall the Company, or a
member of its Board or the Administrative Committee be liable for any additional
tax, interest or penalties that may be imposed on a Participant by Section 409A
of the Code or any damages for failing to comply with Section 409A of the
Code.

       

      
        	
                15. 

              	
                Beneficiary
      Designation.

              


      

       

      Each
Participant shall designate, in a writing signed by such Participant, a
beneficiary to receive Incentive Compensation Payments (pursuant to Section 5
above) in the event of the death of such Participant.