EX-10.1



 





Exhibit 10.1




VERAMARK TECHNOLOGIES, INC.

BOARD OF DIRECTORS AMENDED AND RESTATED DEFERRED

COMPENSATION PLAN

November 20, 2007



1. PURPOSE OF THE PLAN. The purpose of the Veramark Technologies, Inc. Board of Directors
Deferred Compensation Plan (the “Plan”) is to facilitate the recruitment and retention of qualified
individuals to serve as members of the Board of Directors of Veramark Technologies, Inc. (the
“Company”) by providing nonemployee directors of the Company the opportunity to defer all or a
portion of their cash compensation.




2. DEFINITIONS.




     2.1. “Annual Deferred Compensation Agreement” means a written agreement between a Participant
and the Company in substantially the form set forth in Appendix A, whereby a Participant agrees to
defer a portion of his or her Compensation.



     2.2. “Change in Control” means a change in the ownership or effective control of the
Company, or in the ownership of a substantial portion of the assets of the Company, all as defined
under Section 409A(a)(2)(A)(v) of the Code and any regulations or other guidance issued thereunder.



     2.3. “Code” means the Internal Revenue Code of 1986, as amended.



     2.4. “Committee” means the Compensation and Stock Option Committee of the
Company’s Board of Directors, or any successor to the Committee.



     2.5. “Compensation” means a Participant’s fees, payable in cash, for services
rendered by a Participant as a Director of the Company. Compensation shall not include any amounts
paid by the Company to a Participant that are not strictly in consideration for personal services,
such as expense reimbursements.



     2.6. “Deferred Account” means the record maintained by the Company for each
Participant of the cumulative amount of Compensation deferred pursuant to this Plan.



     2.7. “Director” means an individual who is not an employee of the Company and who is a member
of the Company’s Board of Directors.



     2.8. “Participant” means a Director who has entered into a written Annual Deferred
Compensation Agreement with the Company in accordance with the provisions of the Plan.



     2.9. “Termination” means the Participant’s ceasing to be a Director of the Company for any
reason whatsoever, whether voluntarily or involuntarily, including by reason of retirement,
resignation, removal or death. Notwithstanding the preceding sentence, the date on which a
Participant ceases to be a Director of the Company shall be deemed to have not occurred



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for purposes of this Plan unless such cessation constitutes a “separation from service” within the
meaning of Section 409A(a)(2)(A)(i) of the Code and any regulations or other guidance issued
thereunder.


3. ADMINISTRATION AND INTERPRETATION. The Committee shall have final discretion,
responsibility, and authority to administer and interpret the Plan. This includes the discretion
and authority to determine all questions of fact, eligibility, or benefits relating to the Plan.
The Committee may also adopt any rules it deems necessary to administer the Plan. The Committee’s
responsibilities for administration of the Plan may be exercised by Company employees who have been
assigned those responsibilities by the Committee. Any Company employee exercising responsibilities
relating to the Plan in accordance with this section shall be deemed to have been delegated the
discretionary authority vested in the Committee with respect to those responsibilities, unless
limited in writing by the Committee. Any interpretation of the Plan by the Committee shall be final
and binding on the Participants.




4. PARTICIPANT DEFERRAL AND DISTRIBUTION ELECTIONS.




     4.1. TIME AND AMOUNT OF ELECTION. A Director who wishes to participate in the Plan must
execute an Annual Deferred Compensation Agreement in accordance with this Section 4.1.



          (a) The Annual Deferred Compensation Agreement must be filed with the Company by, and shall
become irrevocable as of, December 31 (or such earlier date as specified by the Company on the
Annual Deferred Compensation Agreement) of the calendar year next preceding the calendar year for
which such Compensation would otherwise be earned.




          (b) In the first calendar year in which an individual becomes a Director (or in the first year
of the Plan), the newly eligible Participant may make an election to defer Compensation for that
calendar year in accordance with this Section 4.1(b). The Deferral Election must be filed with the
Company by the thirtieth (30th) day following the date that the individual first becomes eligible
to participate in the Plan (or such earlier date as specified by the Company on the Annual Deferred
Compensation Agreement). The Annual Deferred Compensation Agreement shall become irrevocable on the
date that it is received by the Company. The Annual Deferred Compensation Agreement shall only
apply to Compensation earned after the date that the Annual Deferred Compensation Agreement becomes
irrevocable.




          (c) An Annual Deferred Compensation Agreement that is timely delivered to the Company shall be
effective with respect to Compensation earned in all calendar years following the year in which the
Annual Deferred Compensation Agreement is delivered to the Company, unless such agreement is
revoked or modified (which revocation or modification shall be effective on the first day of the
calendar year following the year in which such revocation or modification is delivered to the
Company) or until terminated automatically upon either the termination of the Plan or the
Participant’s Termination.




     4.2. INTEREST ON DEFERRED AMOUNTS. Compensation which a Director properly elects to be
deferred will accrue interest on a quarterly basis equal to the interest rate realized by the
Company on its invested cash for that quarter.



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5.  DISTRIBUTIONS.




     5.1. DISTRIBUTIONS IN GENERAL.



          (a) The Company shall distribute Participants’ Deferred Accounts as elected by each
Participant in the applicable Annual Deferred Compensation Agreement, except as otherwise provided
in this Section 5. If there is no effective distribution election in place for a Participant as of
the date of his or her Termination, his or her Deferred Account shall be paid out in quarterly
installments over 3 years beginning January 1 of the year following Termination.




          (b) Notwithstanding anything contained in this Plan or the applicable Annual Deferred
Compensation Agreement to the contrary, if the Participant is a “specified employee”, as determined
under the Company’s policy for determining specified employees, on the date of Termination, then to
the extent required in order to comply with Section 409A of the Code, all payments that are
provided as a result of a Termination and that would otherwise be paid during the first six months
following the date of Termination shall be accumulated through and paid within 30 days after the
first business day following the six month anniversary of such date of Termination (or if earlier,
upon the Participant’s death).




     5.2. UPON CHANGE IN CONTROL. Notwithstanding any provision of this Plan or any Annual
Deferred Compensation Agreement to the contrary, if a Change in Control occurs and a Participant
incurs a Termination during the period beginning on the date of the Change in Control and ending on
the second anniversary of the Change in Control, then the remaining amount of the Participant’s
Deferred Account shall be paid to the Participant or his beneficiary in a single lump sum within 10
days after the first business day following the six month anniversary of such date of Termination
(or if earlier, upon the Participant’s death), or such later date as provided in Section 5.1(b).



       5.3. DISTRIBUTIONS FOLLOWING PARTICIPANT DEATH; DESIGNATION OF BENEFICIARY. The Company
shall make all payments to the Participant, if living. A Participant shall designate a beneficiary
in his or her Annual Deferred Compensation Agreement. If a Participant dies either before benefit
payments have commenced under this Plan or after his or her benefits have commenced but before his
or her entire Deferred Account has been distributed, his or her designated beneficiary shall
receive any benefit payments in accordance with the Annual Deferred Compensation Agreement and this
Plan. If no designation is in effect upon the Participant’s death, then the Deferred Account shall
be paid in a lump sum within two (2) months of date of death to the spouse of the Participant, or
if no spouse is then living, the Participant’s estate.



     5.4 TRANSITION RELIEF. A Participant may, no later than December 31, 2007 elect on a form
provided by the Company to (a) change the date of payment of his Deferred Account to a date
otherwise permitted under the Plan or (b) change the form of payment of his Deferred Account to a
form of payment otherwise permitted under the Plan. Notwithstanding the preceding sentence, a
Participant cannot in 2007 change his payment election with respect to payments that the
Participant would otherwise receive in 2007, and a Participant may not cause payments to be made in
2007 that would not otherwise be payable in such year. This Section 5.4 is intended to comply with
Notice 2006-79 and the applicable proposed and final Treasury



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Regulations issued under Section 409A of the Code and shall be interpreted in a manner
consistent with such intent.



6. MISCELLANEOUS.




     6.1. ASSIGNABILITY. A Participant’s rights and interests under the Plan may not be assigned
or transferred except, in the event of the Participant’s death, as described in Section 5.3.



     6.2. TAXES. The Company shall deduct from all payments made under this Plan all applicable
federal, state or local taxes required by law to be withheld.



     6.3. CONSTRUCTION. To the extent not preempted by federal law, the Plan shall be construed
according to the laws of the state of New York without regard to conflict of law rules.
Notwithstanding any other provision herein, this Plan shall be construed, administered, and
governed in a manner that is consistent with, and that satisfies the requirements of, Section 409A
of the Code and any regulations or other guidance issued thereunder, so that taxation of a
Participant is deferred under this Plan until distribution as provided hereunder. Any provision
that would cause the Plan to fail to satisfy the requirements of Section 409A of the Code and any
regulations or other guidance issued thereunder shall have no force and effect until amended to
comply with such requirements (which amendment may be retroactive to the extent permitted by
Section 409A of the Code and may be made by the Company’s Board of Directors (or any committee
thereof) without the consent of the Participants).



     6.4. FORM OF COMMUNICATION. Any election, application, notice or other communication required
or permitted to be made by a Participant to the Committee or the Company shall be made in writing
and in such form as the Company may prescribe. Such communication shall be effective upon receipt
by the Company’s Treasurer.


7.   AMENDMENT AND TERMINATION. Subject to Section 6.3 hereof, the Company, acting through its
Board of Directors, or any committee of the Board of Directors, may, at its sole discretion, amend
or terminate the Plan at any time, provided that the amendment or termination shall not adversely
affect the vested or accrued rights or benefits of any Participant without the Participant’s prior
consent. Moreover, no such amendment or termination shall be effective to the extent such action
would result in an “acceleration of benefits” or a “change in time or form of distribution” within
the meaning of Section 409A of the Code and any regulations or other guidance issued thereunder.



8. UNSECURED GENERAL CREDITOR. The Company’s obligation under the Plan shall be an unfunded and
unsecured promise of the Company to pay money in the future. The Plan does not grant Participants
and their beneficiaries, heirs, successors, and assigns any legal or equitable right, interest, or
claim in any property or assets of the Company. The assets of the Company shall not be held under
any trust for the benefit of Participants, their beneficiaries, heirs, successors, or assigns, or
held in any way as collateral security for the fulfilling of the obligations of the Company under
this Plan. Any and all Company assets shall be, and remain, the general, unpledged, unrestricted
assets of the Company.




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 9. LAWSUITS, JURISDICTION, AND VENUE. Any lawsuit claiming entitlement to benefits
under this Plan must be initiated no later than one year after the event(s) giving rise to the
claim occurred. Any legal action involving benefits claimed or legal obligations relating to or
arising under this Plan may be filed only in Federal District Court in the city of Rochester, New
York. Federal law shall be applied in the interpretation and application of this Plan and the
resolution of any legal action. To the extent not preempted by federal law, the laws of the state
of New York shall apply, without regard to principles of conflict of laws.




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ANNUAL DEFERRED COMPENSATION AGREEMENT




     THIS AGREEMENT dated                     , is between VERAMARK TECHNOLOGIES, INC. (“the Company”) and
                           (the “Director”). The Company designates the Director as a Participant in
the Company’s Board of Directors Deferred Compensation Plan (the “Plan”), a copy of which is
attached and incorporated into this Agreement.


The Company and the Director agree as follows:




For the year                     , the Director irrevocably elects as follows:




1. The Director elects to defer receipt of:





	 	A.	 	$                                         Dollars; or
	 
	 	B.	 	                     percent of Compensation






	 	 	The Company believes, but does not guarantee, that a deferral election made in accordance
with the terms of the Plan is effective to defer the receipt of taxable income. The Director
has been advised to consult with his or her attorney or accountant familiar with the federal
and state tax laws regarding the tax implications of this Deferred Compensation Agreement
and the Plan.




2. The Director elects the following form of distribution of his or her deferrals during such year:




	 	 	 	 	 
	___

	 	A.
	 	Lump-sum payment, commencing within 30 days after the distribution beginning date set forth below.
	 
	 	 	 	 
	___

	 	B.
	 	Quarterly installment payments (estimated to be level payments)
over a period of ___ years (not to exceed 3 years), payable on the first day of the month beginning the calendar quarter immediately
following the distribution beginning date
as set forth below, and continuing on the
first day of the month beginning each
subsequent calendar quarter until paid in
full. The amount of each installment
shall equal the quotient obtained by
dividing the Participant’s account balance
as of the end of the month immediately
preceding the month of such installment
payment by the number of installment
payments remaining to be paid at the time
of the calculation, and the amount of
such account balance remaining unpaid
shall continue to be credited with gains,
losses and earnings as provided in Section 4.2 of the Plan.





3. The Director elects the following distribution beginning date for his or her deferrals during
such year:




	 	 	 	 	 
	___

	 	A.
	 	January 1 of the year following Termination.






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	___

	 	B.
	 	The later of age                      or January 1 of the year following Termination.

	 
	 	 	 	 
	___

	 	C.
	 	The later of                                          (date) or January 1 of the year following Termination.





4. If the Director dies, the Company will pay the Director’s designated beneficiary the Deferred
Account balance as a (choose one):




	 	 	 	 	 
	___

	 	A.
	 	Lump-sum payment, payable within two (2) months of date of death.
	 
	 	 	 	 
	___

	 	B.
	 	Quarterly installment payments over a period of                      years
(not to exceed 3 years), beginning on the first day of the
month beginning the calendar quarter immediately following
the date of death and continuing on the first day of the month
beginning each subsequent calendar quarter until paid in full.
The amount of each installment shall equal the quotient
obtained by dividing the Participant’s account balance as of
the end of the month immediately preceding the month of such
installment payment by the number of installment payments
remaining to be paid at the time of the calculation, and the
amount of such account balance remaining unpaid shall continue
to be credited with gains, losses and earnings as provided in
Section 4.2 of the Plan.






5. The Director’s designated beneficiary is                                                             .




     IN WITNESS WHEREOF, the parties have entered into this Agreement on the day first written
above.



	 	 	 	 	 	 	 	 	 
	 	 	VERAMARK TECHNOLOGIES, INC.	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIRECTOR	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By	 	 	 	 	 	 
	 	 	 	 	 	 	 






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