ex1001.htm


    
       

      Exhibit
No. 10.1

      
      

      Amendment
to Incentive Compensation Plan

    

     

    
      AMENDMENT
TO THE

      GYRODYNE
COMPANY OF AMERICA, INC.

      1999
INCENTIVE COMPENSATION
PLAN

      


      WHEREAS,
Gyrodyne Company of America, Inc. (the "Company") established the Gyrodyne
Company of America 1999 Incentive Compensation Plan ("ICP" or the "Plan")
effective as of June 25, 1999; and

      


      WHEREAS,
the Plan is designed as a Stock Appreciation Rights ("SAR") Program under which
Incentive Compensation Units ("ICUs") equal to Gyrodyne stock are granted to
employees and directors, which ICUs are cashed out based upon the fair market
value of Gyrodyne stock in the event of a Change in Control; and

      


      WHEREAS,
some ICUs authorized after the Plan was established have been granted at less
than fair market value; and WHEREAS, the Plan was amended in August, 2004 to
remove the payment of benefits in stock; and

      


      WHEREAS,
Section 409A of the Internal Revenue Code (the "Code") was enacted as part of
the American Jobs Creation Act of 2004 ("AJCA"); and

      


      WHEREAS,
Section 409A made several changes to nonqualified deferred compensation
arrangements, including SARs that are granted at less than fair market value,
requiring amendment to be made to the ICP to avoid adverse tax consequences to
participants in the ICP; and

      


      WHEREAS,
no deferred compensation is intended to exist under the ICP, since all ICUs vest
upon a Change in Control and become payable, thereby avoiding any deferred
compensation; and

      


      WHEREAS,
in the event of death, a beneficiary inheriting ICUs is entitled to "exercise" a
participant's ICUs which vest upon death, at any time prior to a Change in
Control; and

      


      WHEREAS,
the ICP shall be amended to immediately cash out any vested ICUs in the event of
death, to avoid any deferral of compensation and any adverse tax
consequences.

      


      NOW,
THEREFORE, Gyrodyne hereby executes this Amendment to the Plan as
follows:

      


      
        	
                1.

              	
                Payment
      Upon Death.
      In the event of the death of a Participant, prior to a Change in
      Control of Gyrodyne, as defined under the ICP, the beneficiary of a
      Participant shall immediately receive a payment for all ICUs in an amount
      equal to the appreciation in Gyrodyne stock from the time of grant until
      the date of vesting, upon death. This amount shall be paid within 60 days after the date
      of death. In no event, however, shall the payment be made more than 2 1/2 months after the
      end of the calendar year in which death occurs, thereby avoiding any
      deferral of compensation under the short-term deferral rule as
      established under Section 409A of the Code and the Treasury Regulations
      issued thereunder.

              


      

      


      


      
        
           

        

        
          1

          
            

          

        

        
           

        

      

      
        	
                2.

              	
                Compliance
      With the Code. The ICP is intended to comply with the provisions of
      Section 409A of the Code, and all other provisions of the Code. If there
      is any discrepancy between the provisions of this Plan and the provisions
      of Section 409A, this discrepancy shall be resolved in a manner as to give
      full effect to the provisions of Section 409 A of the
  Code.

              


      

      


      
        	
                3.

              	
                Consequences
      of a Violation. All Participants voluntarily participate in the
      ICP. All Participants shall be notified of the potential tax consequences
      under Section 409A, if the provisions
      of the Plan and Section 409A are not followed, including the imposition of
      immediate income taxes, a 20% excise tax,
      underpayment of interest penalties and Form W-2
      reporting.

              


      

      


      
        	
                4.

              	
                Taxes.
      The Company shall be entitled to deduct from all benefit payments made to
      a Participant or any Beneficiary all applicable federal, state or local
      taxes required by law to be withheld from such
  payments.

              


      

      


      
        	
                5.

              	
                Specified
      Employees. For purposes of the ICP, the term "Specified Employee"
      shall mean a Key Employee, as defined under Section 416 of the Code, who
      is employed by Gyrodyne or any Related Entities which has its stock
      publicly traded on an established securities market. The stock of Gyrodyne
      Company of America, Inc., is
      traded on the NASDAQ Exchange. For purposes of the ICP, the "Specified Employee
      Identification Date" shall be each December 31, and the "Specified Employee Effective
      Date" shall also be December 31. Specified Employees shall be
      determined by the Compensation Committee on an annual basis for purposes
      of all nonqualified deferred compensation plans and any other programs in
      accordance with the provisions of Section 409A of the
  Code.

              


      

      


      
        	
                6.

              	
                Delay
      in Payment for Specified Employees. If a Participant is deemed on
      the date of his "Separation from Service" (within the meaning of Treas.
      Reg. Section 1.409A-1(h)) to be a "Specified Employee", then with regard
      to any payment that is required to be delayed pursuant to Section
      409A(a)(2)(B) of the Code, such payment shall not be made prior to the
      earlier of: (i)
      the expiration of a 6 month period measured
      from the date of his Separation from Service or (ii) the date of death of
      the Employee without interest, unless
      such payment is otherwise permitted within such 6 month period to the
      extent that the benefits to be paid to a Specified Employee do not exceed
      the lesser of the Specified Employee salary for the past 2 years or the Section
      401(a)(17) compensation limitations (i.e., $230,000 in 2008 and
      $245,000 in 2009),
      thereby permitting such amount to be paid within the
      6 month period of
      time during which benefits may generally not be paid to Specified
      Employees. To the extent any payment exceed such limitations (which is a
      maximum of $460,000 in 2008 and
      $490,000 in 2009),
      the balance of any payments will be made following the expiration of the 6
      month period following a Separation of Service as provided
      above.

              


      

       

      
 

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      
        	
                7.

              	
                Payment. Whenever a payment
      under this Amendment or the ICP specifies a payment period with reference
      to a number of days (e.g., "payment shall be made within 30 days after a
      Separation from Service"), the actual date of payment within the specified
      period shall be within the sole discretion of the
  Company.

              


      

      


      IN
WITNESS WHEREOF, this Amendment is hereby executed the 27th day of
December, 2008

       

      
        
          	 	GYRODYNE
      COMPANY OF AMERICA, INC.	 
	 	 	 	 
	
                  Date:
      12-27-08

                	
                  BY:
      

                	/s/ Stephen
      V. Maroney	 
	 	 	 	 


        



       

      


      


      3