Document:

Exhibit 10.6

                Valpey-Fisher Corporation Key Employee Bonus Plan
                              For fiscal year 2004

Purpose of Plan
---------------
To incentive those employees who have a major impact on the profitability of the
company.

Eligibility
-----------
Must be fulltime employee and be in continued employment of the Company for the
entire fiscal year.

2004 Participants - For 2004 the plan participants will include a total of 8
people, 4 more than 2003. The additional people will be with the company for the
entire year or have responsibility and authority to significantly impact the
plan.

1. Michael Ferrantino Sr.           CEO
2. Mike Kroll                       CFO
3. Roman Boroditsky                 CTO
4. Michael Ferrantino Jr.           VP Sales & Marketing
5. Dan Nehring                      VP Engineering
6. Joe Pavao                        VP Operations
7. Sam Gotlib                       Dir. Manufacturing
8. Robert Dandaraw                  Dir. New Business Development

The 2004 pool is based on meeting the 2004 budget for new orders, sales and the
operating profit (loss) amounts. Each participant will have up to four
individual objectives based on their particular area of responsibilities. The
individual objectives will make up 50% of the individual bonus. The CEO will
decide the weights of the individual objective as part of the total payout. In
the case of the CEO the compensation committee will decide. The pool will start
at the same payout of 2003 or $150,000 upon achieving the 2004 budgeted amounts.
The pool will increase based on the levels of operating profit (loss) above the
budget as detailed in Schedule 1. The maximum payout will be $600,000.

The distribution of the bonus and % of individual participation will be based
upon the following potential.

                   CEO up to 100% of salary
                   VP up to 50% of salary
                   Dir. up to 30 % of salary

Payout will either be in stock or cash and will be at the sole discretion of the
CEO and BOD.

<PAGE>

                Valpey-Fisher Corporation Key Employee Bonus Plan
                              For fiscal year 2004

Schedule 1

The pool will increase by the following table:

         Operating
         Profit/(Loss)                      Bonus Pool
         -------------                      ----------

Omitted in filed document                    $150,000
                                             $200,000
                                             $250,000
                                             $300,000
                                             $350,000
                                             $400,000
                                             $450,000
                                             $500,000
                                             $600,000

We will scale all numbers in between.Exhibit 10.1

Exhibit 10.1

NOTICE

This
Restricted Stock Award Agreement (“Agreement”) will be valid only if the Grantee
executes and delivers this Agreement and the attached Stock Power of Attorney to
Vail Banks, Inc., Attn: Lisa M. Dillon on or before March ___, 2005.

 

VAIL
BANKS, INC. 

RESTRICTED
STOCK AWARD AGREEMENT

 

THIS
AGREEMENT, made and entered into as of the 21st day of
March, 2005, by and between Vail Banks, Inc. (“the “Company”) and Gary S. Judd
(“Grantee”). 

 

WITNESSETH
THAT:

 

WHEREAS,
as an inducement for Grantee to enter into employment with the Company, the
Company agreed to grant Grantee certain restricted shares of the Company’s
Common Stock if Grantee assumed additional executive responsibilities within the
Company; and 

 

WHEREAS,
the Board of Directors of the Company has determined that Grantee has satisfied
such conditions and desires to complete the inducement grant in the manner
agreed to;

 

NOW,
THEREFORE, IT IS AGREED, by and between the Company and the Grantee, as follows:

 

	 	
      1.
	
      Award
      of Restricted Stock

 

The
Company hereby grants to the Grantee an award of 100,000 shares of the Company’s
Common Stock, subject to, and in accordance with, the restrictions, terms and
conditions set forth in this Agreement (the “Restricted Stock”). The grant date
of this award of Restricted Stock is March 21, 2005 (“Grant Date”).

 

	 	
      2.
	
      Restrictions

 

2.1 Subject
to Sections 2.2, 2.3, and 2.4 below, if the Grantee remains employed by the
Company, the Grantee shall become vested in the Restricted Stock based upon the
Company’s achievement of the performance targets and other performance goals set
forth on Schedule A attached hereto and made a part here of (as such Schedule A
may be supplemented or amended from time to time), as follows: 10% of the shares
of Restricted Stock shall vest on each anniversary of the Grant Date (each such
date shall be a “Vesting Date” and March 21, 2015 shall be the “Final Vesting
Date”) if the performance targets or other goals with respect to such Vesting
Date have been satisfied on or before the Vesting Date. On each Vesting Date (if
the performance targets and other performance goals have been met), Grantee
shall own the vested shares of Restricted Stock free and clear of all
restrictions imposed by this Agreement (except those imposed by Section 3.4
below). If the performance targets and other performance goals for a Vesting
Date are not met, unless the Company otherwise determines, the shares
ofRestricted Stock that would vest on such Vesting Date shall be forfeited and
cancelled as of such Vesting Date. For purposes of this Agreement, employment
with any subsidiary of the Company, or service as a member of the Company’s
Board of Directors (“Board”) or the board of directors of any subsidiary of the
Company, shall be considered employment with the Company.

 

 

2.2 In the
event, prior to the Final Vesting Date, (i) Grantee dies while actively employed
by the Company, (ii) Grantee has his employment terminated by reason of
Disability (as defined in Section 2.5 below), (iii) Grantee’s employment is
terminated by the Company other than for Cause (as defined in Section 2.5
below), or (iv) Grantee terminates his employment for Good Reason (as defined in
Section 2.5 below), the shares of Restricted Stock that have not been forfeited
and cancelled as of such date shall become fully vested and nonforfeitable as of
the date of Grantee’s death, Disability or termination of employment. The
Company shall deliver certificate(s) for such Restricted Stock, free and clear
of any restrictions imposed by this Agreement (except for Section 3.4) to
Grantee (or, in the event of death, his surviving spouse or, if none, to his
estate) as soon as practical after his date of death or termination for
Disability, termination without Cause, or termination for Good Reason. If
Grantee terminates his employment without Good Reason or if the Company
terminates Grantee for Cause, the Restricted Stock shall cease to vest further
and Grantee shall only be entitled to the Restricted Stock that is vested as of
his date of termination.

 

2.3 Notwithstanding
the other provisions of this Agreement, in the event of a Change in Control (as
defined in Section 2.5 below) prior to Grantee’s Final Vesting Date, the shares
of Restricted Stock that have not been forfeited and cancelled as of such date
shall become fully vested and nonforfeitable as of the date of the Change in
Control. On or as soon as practical after the date of the Change in Control, the
Company shall deliver to Grantee a certificate(s) for such Restricted Stock,
free and clear of any restrictions imposed by this Agreement. 

 

2.4 The
Restricted Stock may not be sold, assigned, transferred, pledged or otherwise
encumbered prior to the date Grantee becomes vested in the Restricted Stock.

 

2.5 Definitions.

 

(a) “Cause”
means: (i) willful misconduct on the part of the Grantee that is materially
detrimental to the Company; or (ii) the conviction of the Grantee for the
commission of a felony. The existence of “Cause” under either (i) or (ii) shall
be determined by the Board or a committee of the Board. Notwithstanding the
foregoing, if the Grantee has entered into an employment agreement that is
binding as of the date of employment termination, and if such employment
agreement defines “Cause,” and/or provides a means of determining whether
“Cause” exists, such definition of “Cause” and/or means of determining its
existence shall supersede this provision. 

 

(b) A “Change
in Control” shall be deemed to have occurred if:

 

(i) An
acquisition by any Person (as defined in Section 3(a)(9) of the Securities
Exchange Act of 1934, as amended from time to time (the “Exchange Act”),
including a “group” as defined in Section 13(d) thereof) of
Beneficial

 

-2-

Ownership
(as defined in Rule 13d-3 of the Exchange Act) of the shares of the Company then
outstanding (the “Company Common Stock Outstanding”) or the voting securities of
the Company then outstanding entitled to vote generally in the election of
directors (the “Company Voting Securities Outstanding”), if such acquisition of
Beneficial Ownership results in the Person beneficially owning (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) twenty-five percent
(25%) or more of the Company Common Stock Outstanding or twenty-five percent
(25%) or more of the combined voting power of the Company Voting Securities
Outstanding; provided, that immediately prior to such acquisition such Person
was not a direct or indirect Beneficial Owner of twenty-five percent (25%) or
more of the Company Common Stock Outstanding or twenty-five percent (25%) or
more of the combined voting power of Company Voting Securities Outstanding, as
the case may be; or

 

(ii) The
consummation of a reorganization, merger, consolidation, complete liquidation or
dissolution of the Company, the sale or disposition of all or substantially all
of the assets of the Company or similar corporate transaction (in each case
referred to in this Section 2.5(b) as a “Corporate Transaction”) or, if
consummation of such Corporate Transaction is subject to the consent of any
government or governmental agency, the obtaining of such consent (either
explicitly or implicitly); 

 

(iii) A change
in the composition of the Board of Directors such that the individuals who, as
of the Grant Date, constitute the Board (such Board shall be hereinafter
referred to as the “Incumbent Board”) cease for any reason to constitute at
least a majority of the Board; provided, however, for purposes of this Section
2.5(b) that any individual who becomes a member of the Board subsequent to the
Grant Date whose election, or nomination for election by the Company’s
shareholders, was approved by a vote of at least a majority of those individuals
who are members of the Board and who were also members of the Incumbent Board
(or deemed to be such pursuant to this proviso) shall be considered as though
such individual were a member of the Incumbent Board; but, provided, further,
that any such individual whose initial assumption of office occurs as a result
of either an actual or threatened election contest (as such terms are used in
Rule 14a-11 of Regulation 14A promulgated under the Exchange Act, including any
successor to such Rule), or other actual or threatened solicitation of proxies
or consents by or on behalf of a Person other than the Board, shall not be so
considered as a member of the Incumbent Board;

 

(iv) Notwithstanding
the provisions set forth in subsections (i) and (ii), the following shall not
constitute a Change in Control for purposes of this Agreement: (1) any
acquisition of shares by, or consummation of a Corporate Transaction with, any
subsidiary or any employee benefit plan (or related trust) sponsored or
maintained by the Company or an affiliate; or (2) any acquisition of shares, or
consummation of a Corporate Transaction, following which more than fifty percent
(50%) of, respectively, the shares then outstanding of common stock of the
corporation resulting from such acquisition or Corporate Transaction
and

 

-3-

the
combined voting power of the voting securities then outstanding of such
corporation entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by all or substantially all of the
individuals and entities who were Beneficial Owners, respectively, of the
Company Common Stock Outstanding and Company Voting Securities Outstanding
immediately prior to such acquisition or Corporate Transaction in substantially
the same proportions as their ownership, immediately prior to such acquisition
or Corporate Transaction, of the Company Common Stock Outstanding and Company
Voting Securities Outstanding, as the case may be.

 

(c) “Disability”
shall have the meaning ascribed to such term in the Company’s long-term
disability plan covering the Grantee, or in the absence of such a plan, a
meaning consistent with Section 22(e)(3) of the Internal Revenue Code of 1986,
as amended (the “Code”).

 

(d) “Good
Reason” shall mean: 

 

(i) the
assignment to Grantee of any duties inconsistent with his positions, duties,
responsibilities and status with the Company, its subsidiaries and affiliates as
of the date hereof, or a change in his reporting responsibilities, titles or
offices which were in effect as of the date hereof, or any removal of him from,
or any failure to re-elect him to, any of such positions, except in connection
with the termination of his employment by the Company for Cause or as a result
of his death or Disability or termination by him other than for Good
Reason;

 

(ii) a
reduction by the Company in the Grantee’s base salary as in effect on the date
hereof or as the same may be increased from time to time, or failure to give him
annual salary increases consistent with performance review ratings as compared
with other employees of the same or similar rank;

 

(iii) a failure
by the Company to cover Grantee under an annual bonus program comparable to the
annual bonus program provided to him as of the date hereof; or

 

(iv) The
Company’s requiring that Grantee be based anywhere other than the Company’s
offices in the Denver, Colorado area, except for required travel on Company
business to an extent substantially consistent with his present business travel
obligations, or in the event that Grantee consents to any such relocations, the
failure by the Company to pay (or reimburse him for) all reasonable moving
expenses incurred by him.

 

(v)  the
failure by the Company to continue in full force  and effect any
benefit, retirement, savings or compensation plan or any employee life,
accident, disability, medical, dental, vision or other employee welfare benefit
plan in which Grantee is participating at the date hereof, the taking of any
action by the Company which would adversely affect his participation in or
materially reduce his benefits under any of such plans or deprive him of any
material fringe benefit

 

 

 

-4-

 

or
perquisite (including but not limited to the provision of an automobile and the
payment of club dues) enjoyed by him at the date hereof, or the failure by the
Company to provide him with the number of paid personal days to which he
is then entitled in accordance with the policies in effect on the date
hereof. 

 

	 	
      3.
	
      Stock;
      Dividends; Voting

 

3.1 Upon
delivery to the Company of the executed Stock Powers attached hereto, the
Company shall register on the Company books stock certificate(s) evidencing the
shares of Restricted Stock in the name of the Grantee. Physical possession or
custody of such stock certificate(s) shall be retained by the Company until such
time as the shares of Restricted Stock are fully vested in accordance with
Section 2. While in its possession, the Company reserves the right to place a
legend on the stock certificate(s) restricting the transferability of such
certificates and referring to the terms and conditions (including forfeiture) of
this Agreement. Upon forfeiture of all or a portion of the shares of Restricted
Stock, the stock certificate(s) held on behalf of the Grantee for such forfeited
Restricted Stock shall be transferred to the Company pursuant to the executed
Stock Power described above.

 

3.2 During
the period the Restricted Stock is not vested (and has not been forfeited), the
Grantee shall be entitled to receive dividends and/or other distributions
declared on such Restricted Stock and Grantee shall be entitled to vote such
Restricted Stock. 

 

3.3 In the
event of a change in capitalization, the number and class of shares of
Restricted Stock or other securities that Grantee shall be entitled to, and
shall hold, pursuant to this Agreement shall be appropriately adjusted or
changed to reflect the change in capitalization, provided that any such
additional shares of Restricted Stock or additional or different shares or
securities shall remain subject to the restrictions in this Agreement. If
additional shares of common stock of the Company or another corporation, or
other consideration is issued in connection with the Restricted Stock at a time
at which the restrictions specified in this Agreement have not lapsed, the
Grantee shall execute and deliver to the Company additional Stock Power(s) of
Attorney with respect to any such shares of stock, deliver to the Company the
stock certificates representing such shares, and forward to the Company any such
other consideration. Such stock certificates and/or other consideration shall be
retained by the Company and shall be credited to the account of the Grantee and
shall be distributed to the Grantee, subject to forfeiture and the other terms
and conditions of this Agreement, at the same time as the shares of Restricted
Stock are to be distributed free of all restrictions.

 

3.4 The
Grantee represents and warrants that he is acquiring the Restricted Stock for
investment purposes only, and not with a view to distribution thereof. The
Grantee is aware that the Restricted Stock may not be registered under the
federal or any state securities laws and that, in addition to the other
restrictions on the Restricted Stock, the shares will not be able to be
transferred unless an exemption from registration is available. By making this
award of Restricted Stock, the Company is not undertaking any obligation to
register the Restricted Stock under any federal or state securities
laws.

 

-5-

 

	 	
      4.
	
      No
      Right to Continued Employment

 

Nothing
in this Agreement shall be interpreted or construed to confer upon the Grantee
any right with respect to continuance of employment by the Company or a
subsidiary, nor shall this Agreement interfere in any way with the right of the
Company or a Subsidiary to terminate the Grantee’s employment at any time,
subject to Grantee’s rights under this Agreement. 

 

	 	
      5.
	
      Taxes
      and Withholding

 

The
Grantee shall be responsible for all federal, state and local income taxes
payable with respect to this award of Restricted Stock and any employment taxes
payable by Grantee as an employee. The Grantee shall have the right to make such
elections under the Code, as are available in connection with this award of
Restricted Stock, including a Section 83(b) election. The Company and Grantee
agree to report the value of the Restricted Stock in a consistent manner for
federal income tax purposes. The Company shall have the right to retain and
withhold from any payment of Restricted Stock the amount of taxes required by
any government to be withheld or otherwise deducted and paid with respect to
such payment. The Company may require Grantee to reimburse the Company for any
such taxes required to be withheld and may withhold any distribution in whole or
in part until the Company is so reimbursed. In lieu thereof, the Company shall
have the right to withhold from any other cash amounts due to Grantee an amount
equal to such taxes required to be withheld or withhold and cancel (in whole or
in part) a number of shares of Restricted Stock having a market value not less
than the amount of such taxes. 

 

	 	
      6.
	
      Modification
      of Agreement

 

This
Agreement may be modified, amended, suspended or terminated, and any terms or
conditions may be waived, but only by a written instrument executed by the
parties hereto. 

 

	 	
      7.
	
      Severability

 

Should
any provision of this Agreement be held by a court of competent jurisdiction to
be unenforceable or invalid for any reason, the remaining provisions of this
Agreement shall not be affected by such holding and shall continue in full force
in accordance with their terms. 

 

	 	
      8.
	
      Governing
      Law 

 

The
validity, interpretation, construction and performance of this Agreement shall
be governed by the laws of the State of Colorado without giving effect to the
conflicts of laws principles thereof. 

 

	 	
      9.
	
      Successors
      in Interest

 

This
Agreement shall inure to the benefit of, and be binding upon, the Company and
its successors and assigns, and upon any person acquiring, whether by merger,
consolidation, reorganization, purchase of stock or assets, or otherwise, all or
substantially all of the Company’s assets and business. This Agreement shall
inure to the benefit of the Grantee’s legal representatives. All obligations
imposed upon the Grantee and all rights granted to the Company under this
Agreement shall be final, binding and conclusive upon the Grantee’s heirs,
executors, administrators and successors. 

 

-6-

 

	 	
      10.
	
      Resolution
      of Disputes 

 

Any
dispute or disagreement which may arise under, or as a result of, or in any way
relate to the interpretation, construction or application of this Agreement
shall be determined by the Board or a committee of the Board. Any determination
made hereunder shall be final, binding and conclusive on the Grantee and the
Company for all purposes.

 

IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written. 

 

	 	
      VAIL
      BANKS, INC. 

       

       

       

      By:
      ___________________________

            
      Lisa M. Dillon, Vice Chairman

       

	 	
      GRANTEE:

       

       

       

                                                                             
      

      Gary
      S. Judd

-7-

STOCK
POWER

FOR VALUE
RECEIVED, the undersigned does hereby assign and transfer to
____________________________________ _______________________________ (_____)
shares of the common stock of Vail Banks, Inc. (the “Company”) registered on the
books of the Company in the name of the undersigned (whether a certificate has
been issued or not), and does hereby irrevocably constitute and appoint
_________________________________ attorney to transfer said stock on the books
of the Company, with full power of substitution in the premises.

DATED:
______________________

 

                                                                         

Name:
Gary S. Judd

 

-8-

SCHEDULE
A

	
      Vesting
      Date
	
      Performance
      Targets and Goals

	 	 
	
      March
      21, 2006
	
      1.
      Company achieving net profit after tax

	 	
      on
      a fully consolidated basis of $4.2 million

	 	
      for
      2005

	 	
      2.
      CAMELS rating of “2” or better for Vail Banks, Inc.

      and
      WestStar Bank on the then most recent regulator

      safety
      and soundness examination report

	 	 
	
      March
      21, 2007 and later years
	
      Performance
      Targets and other goals will be

	 	
      established
      at the beginning of the Company’s

	 	
      fiscal
      year.

The
determination of whether a Performance Target has been met will be based upon
the Company’s financial statements, adjusted by the Company as it deems
appropriate to take into account changes to the business or its operations,
acquisitions or dispositions, tax law changes, accounting changes or similar
unusual events or items.

 

 

 

 

 

-9-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}]]