Exhibit 10

 

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Exhibit 10

FIRST AMENDMENT TO THE
FIRST FEDERAL BANKSHARES, INC.
AMENDED AND RESTATED 1999 STOCK OPTION PLAN

Pursuant to Section 21 of the First Federal Bankshares, Inc. Amended and
Restated 1999 Stock Option Plan (the “Option Plan”), the Option Plan is hereby
amended, effective as of January 19, 2006, as follows:

                                
1.
By adding the following new Section 10(c) to the Option Plan:

“(c) Relinquishment of Rights. Notwithstanding anything in the Plan to the
contrary, effective as of January 19, 2006, the Committee shall not grant any
new Awards of Limited Rights to any Key Employees. With respect to outstanding
Awards of Limited Rights granted prior to January 19, 2006, the Board of
Directors shall take such action as it determines to be necessary and
appropriate to obtain the consent of Participants to relinquish their rights to
such outstanding Limited Rights prior to January 19, 2006. Outstanding Awards of
Limited Rights that are relinquished by Participants pursuant to the foregoing
shall be evidenced by a written consent form signed and dated by the affected
Participant in accordance with Section 21 of the Plan, provided, however, that
nothing in the consent form shall (i) affect the Participant’s other rights
under his outstanding Options, or (ii) restrict the ability of the Company, in
its sole discretion, or any third party to make a cash payment to the
Participant in exchange for the termination or cancellation of the Participant’s
Options.”

 
2.
By adding the following new paragraph at the end of Section 16 of the Option
Plan:

“Notwithstanding anything in the Plan to the contrary, no provision of the Plan
shall operate to require the cash settlement of a stock option under any
circumstance that is not within the sole discretion of the Company.”

 
3.
By substituting the following for Section 19(a) of the Option Plan:

“(a) provide that such Options shall be assumed, or equivalent options shall be
substituted (“Substitute Options”) by the acquiring or succeeding corporation
(or an affiliate thereof), provided that: (A) any such Substitute Options
exchanged for Incentive Stock Options shall meet the requirements of Section
424(a) of the Code, and (B) the shares of stock issuable upon the exercise of
such Substitute Options shall constitute securities registered in accordance
with the Securities Act of 1933, as amended (“1933 Act”) or such securities
shall be exempt from such registration in accordance with Sections 3(a)(2) or
3(a)(5) of the 1933 Act, (collectively, “Registered Securities”), or in the
alternative, and in the sole

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               discretion of the Company, if the securities issuable upon the
exercise of such Substitute Options shall not constitute Registered Securities,
then the Participant will receive upon consummation of the Change in Control a
cash payment for each Option surrendered equal to the difference between the (1)
Fair Market Value of the consideration to be received for each share of Common
Stock in the Change in Control times the number of shares of Common Stock
subject to such surrendered Options, and (2) the aggregate exercise price of all
such surrendered Options, or”

IN WITNESS WHEREOF, First Federal Bankshares, Inc. has caused this amendment to
be adopted by a duly authorized officer, this 19th day of January, 2006.

 

 
FIRST FEDERAL BANKSHARES, INC
           
By
s/ Michael W. Dosland
     
Michael W. Dosland
                   
Its
President and Chief Executive Officer