Exhibit 10.6
VSB Bancorp, Inc.
RESTATED 2000 INCENTIVE STOCK OPTION PLAN
1.
PURPOSE
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The purpose of the Restated 2000 Incentive Stock Option Plan
(the
"Plan") is to advance the interests of VSB Bancorp, Inc. (the
"Company") and its
shareholders by providing those key employees of the Company and
its affiliates,
upon whose judgment, initiative and efforts the successful conduct
of the
business of the Company and its affiliates largely depends, with
additional
incentive to perform in a superior manner. A purpose of the Plan is
also to
attract people of experience and ability to the service of the
Company and its
affiliates.
2.
DEFINITIONS
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(a)
"Affiliate" means (i) a member of a controlled group of
corporations of which the Company is a member or (ii) an
unincorporated trade or
business which is under common control with the Company as
determined in
accordance with Section 414(c) of the Internal Revenue Code of
1986, as amended,
(the "Code") and the regulations issued thereunder. For purposes
hereof, a
"controlled group of corporations" shall mean a controlled group of
corporations
as defined in Section 1563(a) of the Code determined without regard
to Section
1563(a)(4) and (e)(3)(C).
(b) "Award"
means a grant of Incentive Stock Options under the
provisions of this Plan.
(c) "Board of
Directors" or "Board" means the board of directors
of the Company.
(d) "Change in
Control" of the Company, for purposes of this Plan,
means an event of a nature that: (i) would be required to be
reported in
response to Item 1 of the current report on Form 8-K, as in effect
on the date
hereof, pursuant to Section 13 of the Securities Exchange Act of
1934 (the
"Exchange Act"); or (ii) results in a Change in Control of Victory
State Bank
(the "Bank") within the meaning of the Change in Bank Control Act
and the rules
and regulations promulgated by the Federal Deposit Insurance
Corporation (the
"FDIC") at 12 C.F.R. ss.303, as in effect on the date hereof; or
(iii) results
in a transaction requiring prior approval of the Federal Reserve
Board ("FRB"),
under the Bank Holding Company Act of 1956 and the regulations
promulgated
thereunder by the FRB at 12 C.F.R. ss.225.11, as in effect on the
date hereof or
(iv) without limitation, such a Change in Control shall be deemed
to have
occurred at such time as (A) any "person" (as the term is used in
Sections 13(d)
and 14(d) of the Exchange Act) is or becomes the "beneficial owner"
(as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of
the Company representing 20% or more of the Company's outstanding
securities or
(B) individuals who constitute the Board on the date hereof (the
"Incumbent
Board") cease for any reason to constitute at least a majority
thereof, provided
that any person becoming a director subsequent to the date hereof
whose election
was approved by a vote of a majority of the directors comprising
the Incumbent
Board, or whose nomination for election by the Company's
stockholders was
approved by the Incumbent Board, shall be, for purposes of this
clause (B),
considered as though he or she were a member of the Incumbent
Board; or (C) a
plan of reorganization, merger, consolidation, sale of all or
substantially all
the assets of the Company or similar transaction occurs in which
the Company is
not the resulting entity; or (D) a proxy statement shall be
distributed
soliciting proxies from shareholders of the Company, by someone
other than the
current management of the Company, seeking stockholder approval of
a plan of
reorganization, merger or consolidation of the Company or similar
transaction
with one or more corporations as a result of which the outstanding
shares of the
class of securities then subject to the plan or transaction are
exchanged for or
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converted into cash or property or securities not issued by the
Company; or (E)
a tender offer is made for 20% or more of the voting securities of
the Company.
(e)
"Committee" means a committee consisting of those members of
the Incentive Stock Option Committee of the Company who are
non-employee members
of the Board of Directors, all of whom are "disinterested
directors" as such
term is defined under Rules 16b-3 under the Exchange Act, as
promulgated by the
Securities and Exchange Commission.
(f) "Common
Stock" means the Common Stock of the Company, par
value, $0.0001 per share.
(g) "Date of
Grant" means the date an Award granted by the
Committee is effective pursuant to the terms hereof.
(h)
"Disability" means disability as defined in the Bank's long
term disability plan, or if not so defined, disability shall mean
the permanent
and total inability by reason of mental or physical infirmity, or
both, of an
employee to perform the work customarily assigned to him or her.
Additionally, a
medical doctor selected or approved by the Board of Directors must
advise the
Committee that it is either not possible to determine when such
Disability will
terminate or that it appears probable that such Disability will be
permanent
during the remainder of said Participant's lifetime.
(i) "Fair
Market Value" means, when used in connection with the
Common Stock on a certain date: (i) if the bid and asked price of
the Common
Stock is reported by the National Association of Securities Dealers
Automated
Quotation System (as published by the Wall Street Journal, if
published) on such
date or if the Common Stock was not traded on such date, on the
next preceding
day on which the Common Stock was traded thereon or the last
previous date on
which a sale is reported, or (ii) if the bid and asked price of the
Common Stock
is not so reported, but the Common Stock is traded in the
over-the-counter
market, the mean of the highest bid price and the lowest asked
price for the
Common Stock on the date of grant as reported by the National
Quotation Bureau,
Inc. or any successor organization, or (iii) if a realistic and
fair market
value of such shares is not readily determinable, an estimation of
the fair
market value made by taking into consideration the market value of
the shares of
comparable financial institutions and the trend of the Company's
earnings.
(j) "Incentive
Stock Option" means an Option granted by the
Committee to a Participant.
(k)
"Non-Statutory Stock Option" means an Option granted by the
Committee to a Participant and which is not deemed to be an
Incentive Stock
Option.
(l) "Option"
means Award granted under Section 6.
(m)
"Participant" means an employee of the Company or its
Affiliates chosen by the Committee to participate in the Plan.
(n) "Plan
Year(s)" means a calendar year or years commencing on or
after January 1, 2000.
(o)
"Retirement" means termination of employment, which
constitutes retirement under any tax qualified plan maintained by
the Company or
any of its Affiliates.
(p)
"Termination for Cause" means the termination upon an
intentional failure to perform stated duties, personal dishonesty
which results
in loss to the Company or one of its Affiliates or willful
violation of any law,
rule or regulation (other than traffic violations or similar
offenses) or final
cease-and-desist order which results in substantial loss to the
Company or one
of its Affiliates.
2
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3.
ADMINISTRATION
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The Plan shall be administered by the Committee. The Committee
is
authorized, subject to the provisions of the Plan, to establish and
amend such
rules and regulations as it deems necessary for the proper
administration of the
Plan and to make whatever determinations and interpretations in
connection with
the Plan it deems necessary or advisable. All determinations and
interpretations
made by the Committee shall be binding and conclusive on all
Participants in the
Plan and on their legal representatives and beneficiaries.
4.
STOCK SUBJECT TO THE PLAN
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Subject to adjustment as provided in Section 10, the maximum number
of
shares reserved for purchase pursuant to the exercise of options
granted under
the Plan is 31,500 shares of Common Stock of the Company, par value
$0.0001 per
share.
5.
ELIGIBILITY
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Key officers and other key employees of the Company or its
Affiliates,
as determined by the Committee, shall be eligible to receive
Incentive Stock
Options under the Plan. Directors who are not both employees and
officers of the
Company or its Affiliates shall not be eligible to receive Awards
under the
Plan.
6.
INCENTIVE STOCK OPTIONS
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Grant of Options
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The Committee may, from time to time, grant Incentive Stock Options
to
eligible employees. Incentive Stock Options granted pursuant to the
Plan shall
be subject to the following terms and conditions:
(a) Price. The
purchase price per share of Common Stock
deliverable upon the exercise of each incentive Stock Option shall
be not less
than 100% of the Fair Market
