EXHIBIT 10.16
IRWIN FINANCIAL CORPORATION
EMPLOYEES’ STOCK PURCHASE PLAN III
WITNESSETH:
WHEREAS, Irwin Financial Corporation (“Corporation”) desires to provide eligible
employees of the Corporation and certain affiliated companies with an
opportunity to acquire a proprietary interest in the Corporation through the
purchase of Common Shares of the Corporation; and
WHEREAS, the Corporation desires to offer further inducement to eligible
employees to remain as employees by providing a form of additional compensation,
for services which the employees have rendered or will hereafter render, through
the purchase of Common Shares at a discounted rate.
NOW, THEREFORE, the Corporation hereby establishes this employee stock purchase
plan pursuant to the provisions of section 423 of the Internal Revenue Code of
1986, as amended, as follows:
ARTICLE
ESTABLISHMENT OF PLAN
     The 1999 Irwin Financial Corporation Employees’ Stock Purchase Plan (the
“Plan”) is hereby established effective as of the date the registration of the
Common Shares to be issued hereunder is declared effective by the Securities and
Exchange Commission, provided however, that this Plan shall not become effective
unless it has received the approval of the holders of a majority of the issued
and outstanding Common Shares of the Corporation who are either present or
represented and are entitled to vote at a meeting of shareholders of the
Corporation duly held within twelve (12) months before or after the date the
Plan is adopted by the Board of Directors.
ARTICLE
DEFINITIONS AND CONSTRUCTION
Section 2.01. Definitions. When the initial letter of a word or phrase is
capitalized, the meaning of such word or phrase shall be as follows:

  a)   “Account” means the record of a Participant’s interest in the Plan, as
maintained by the Committee or its designee pursuant to Section 7.01(c),
consisting of the sum of the Participant’s payroll deductions under the Plan,
the deduction of the amounts expended on behalf of the Participant to exercise
his or her options under

 

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      the Plan, the credit of the number of Common Shares (including fractional
shares) purchased under the Plan for the Participant and held by the Custodian
and the amounts, if any, carried forward on behalf of the Participant from one
Date of Exercise to the next Date of Exercise.

  b)   “Affiliate” means a corporation which is a parent or subsidiary of the
Corporation, or a corporation or a parent or subsidiary corporation of such
corporation issuing or assuming an option in a transaction to which Code Section
425(a) applies.     c)   “Board of Directors” means the board of directors of
the Corporation as it shall exist from time to time.     d)   “Code” means the
Internal Revenue Code of 1986, as amended from time to time.     e)  
“Committee” means the committee appointed by the Board of Directors under
Section 7.01 to administer the Plan.     f)   “Common Shares” means the Common
Shares of the Corporation.     g)   “Corporation” means Irwin Financial
Corporation, an Indiana corporation, and its successors and assigns.     h)  
“Custodian” means any party designated by the Board of Directors pursuant to
Section 7.02 to act as custodian under the Plan.     i)   “Date of Exercise”
means the first business day following a Payday and/or such other date or dates
as may be established by the Committee as a date upon which options granted
under the Plan are to be exercised.     j)   “Effective Date” means the
effective date of this Plan, which is the date the registration under the
Securities Act of 1933, as amended, of Common Shares to be issued hereunder is
declared effective by the Securities and Exchange Commission.     k)   “Eligible
Employee” means any person employed by the Corporation as a common law employee
or any of its Affiliates except for:

  1)   employees who have been employed less than six months (other than former
Participants re-employed by the Company);     2)   employees who customary
employment is less than twenty (20) hours per week; and     3)   employees whose
customary employment is for not more than five (5)months in any calendar year.

 

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  l)   “Option Price” means the price to be paid by Participants upon the
exercise of options granted under this Plan, determined as provided in Section
5.02.     m)   “Participant” means an Eligible Employee who (i) authorizes the
Corporation or an Affiliate to make payroll deductions from Plan Compensation
for the purpose of purchasing Common Shares pursuant to the Plan, (ii) has
commenced participation in the Plan pursuant to Section 3.01, and (iii) has not
incurred a voluntary or involuntary withdrawal, pursuant to Article VI or
Section 7.04 since his or her most recent commencement of participation pursuant
to Section 3.01.     n)   “Payday” means the date on which an Eligible Employee
receives any Plan Compensation.     o)   “Plan” means the 1999 Irwin Financial
Corporation Employees’ Stock Purchase Plan, as amended from time to time.     p)
  “Plan Compensation” means all cash payments made by the Corporation or any
Affiliate to an Employee through its payroll system for services as an employee
including, without limitation, wages, salary, incentive compensation, bonuses
and profit sharing payments.     q)   “Section,” when not preceded by the word
“Code,” means a section of this Plan.

Section 2.02. Construction and Governing Law

  a)   This Plan shall be construed, enforced and administered and the validity
thereof determined in accordance with the Code and the regulations thereunder,
and in accordance with the laws of the State of Indiana when such laws are not
inconsistent with the Code.     b)   This Plan is intended to qualify as an
employee stock purchase plan under Code Section 423 and the regulations
thereunder. The provisions of the Plan shall be construed so as to fulfill this
intention.

ARTICLE
PARTICIPATION
Section 3.01. Participation.

  a)   Any person who is an Eligible Employee on the Effective Date may become a
Participant in the Plan as of the first Payday after the Effective Date, by
completing and delivering to the Committee such forms as the Committee shall

 

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      require to authorize payroll deductions and to request participation in
the Plan, within the time period established by the Committee.

  b)   After the Effective Date, an Eligible Employee who is not a participant
may become a Participant in the Plan as of the first day of a calendar quarter,
by completing and returning to the Committee at least thirty (30) days before
such date such forms as the Committee shall require to authorize payroll
deductions and request participation in the Plan.

Section 3.02. Payroll Deductions

  a)   Payroll deductions for a Participant shall commence on the first Payday
after an Eligible Employee becomes a Participant and shall continue until the
earlier of (i) the termination of the Plan or (ii) the date the Participant
suspends his or her payroll deductions or ceases participation pursuant to
subsection (b) of this Section 3.02. Each Participant shall authorize his or her
employer to make deductions from his or her Plan Compensation on each Payday
during the time he or she is a Participant in the Plan in a specified whole
dollar amount; provided, however, the minimum amount of the payroll deduction
authorized by the Participant must be at least $5.00 per Payday.     b)   A
Participant may suspend or change his or her payroll deduction in the Plan
effective as of any Payday by filing written notice with the Committee at least
ten (10) days prior to such Payday. A Participant’s suspension of his or her
payroll deductions shall not automatically result in his or her withdrawal from
participation in the Plan.

Section 3.03. Participant’s Account. On each Payday, the Corporation or its
Affiliate, as the case may be, shall deduct the authorized amount from each
Participant’s Plan Compensation and shall credit the Account of each Participant
with the amount of the Participant’s payroll deduction under the Plan effective
as of the Payday on which it was deducted.
ARTICLE
COMMON SHARES
The shares subject to options granted under this Plan shall be Common Shares.
The total number of Common Shares on which options may be granted under this
Plan shall not exceed in the aggregate Seven Hundred Fifty Thousand (750,000)
Common Shares, except as such number of Common Shares shall be adjusted in
accordance with Section 8.01 of this Plan. Common Shares required to satisfy
purchases pursuant to the Plan may be provided out of the Corporation’s treasury
shares or its authorized and unissued Common Shares.

 

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ARTICLE
GRANTING AND EXERCISE OF OPTIONS
Section 5.01. Grant of Options

  a)   On each Payday, there shall be granted automatically by the Corporation
to each Participant, except those identified in subsection (b) of this Section
5.01, an option to purchase on the next succeeding Date of Exercise at the
Option Price such number of the Common Shares, including fractional shares,
reserved for issuance pursuant to this Plan as the balance in such Participant’s
Account on such Date of Exercise enables him or her to purchase.     b)  
Notwithstanding any provision in this Plan to the contrary, no Participant shall
be granted an option:

  1)   if the Participant, immediately after the option is granted, would own
shares possessing five percent (5%) or more of the total combined voting power
or value of all classes of shares of the Corporation or its Affiliates, provided
that (i) the rules of Code Section 425(d) shall apply in determining the share
ownership of an individual, and (ii) shares which the Participant may purchase
under outstanding options shall be deemed to be owned by the Participant; or    
2)   which permits his or her rights to purchase shares under all employee stock
purchase plans of the Corporation and its Affiliates to accrue at a rate which
exceeds Twenty-five Thousand Dollars ($25,000) of fair market value of Common
Shares (determined at the time such option is granted) for each calendar year in
which such option is outstanding at any time.

Section 5.02. Option Price. The option price for Common Shares purchased as of
each Date of Exercise shall be eighty-five percent (85%) of the closing price of
the Common Shares as reported by the National Association of Securities Dealers
Automated Quotation/National Market System (“Nasdaq/NMS”) for the last trading
day prior to such Date of Exercise or, if not so reported, as reported by such
other source as the Committee shall designate.
Section 5.03. Exercise of Option: Limitations. As of each Date of Exercise, each
Participant’s option to purchase Common Shares shall be exercised automatically
for his or her Account. The Participant shall purchase the number of shares,
including fractional shares, which the amount of cash credited to his or her
Account on that Date of Exercise shall enable him or her to purchase at the
Option Price. As soon as administratively reasonable after each Date of
Exercise, the Corporation shall notify the Custodian of the number of Common
Shares purchased for the Account of each Participant on such Date of Exercise.

 

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Section 5.04. Interest in Shares. A Participant shall have no interest in or
rights as a shareholder with respect to Common Shares subject to an option
granted under this Plan until such option has been exercised and the number of
Common Shares purchased has been credited to the Participant’s Account. Upon
written request directed to the Committee, a Participant shall be entitled to
receive a certificate representing the number of whole Common Shares and/or cash
in lieu of any fractional shares credited to the Participant’s Account. Upon
receipt of any such request, the Committee shall promptly direct the Custodian
to distribute such certificates, if any, and the Corporation to pay such cash,
if any, to the Participant.
Section 5.05. Fractional Shares. A Participant shall be entitled to participate
in any dividend or other distribution with respect to any fractional share
credited to the Participant’s Account, but shall have no right to vote any
fractional share. No certificates will be issued representing fractional shares
purchased pursuant to the Plan. Upon a Participant’s withdrawal from the Plan
under Article VI or Section 7.04 or upon the Committee’s receipt of a request to
issue certificates pursuant to Section 5.04, there shall be paid in lieu of any
fractional share held in a Participant’s Account an amount in cash equal to the
product of (i) the amount of the fraction, multiplied by (ii) the closing price
of the Common Shares as reported by the Nasdaq/NMS for the effective date of the
Participant’s withdrawal from the Plan or the date on which the Committee
receives the request pursuant to Section 5.04, whichever applies.
ARTICLE
WITHDRAWAL
Section 6.01. Voluntary Withdrawal. A Participant may withdraw from
participation in the Plan as of any Payday by delivering written notice to the
Committee at least ten (10) days prior to such Payday. The Committee shall
promptly notify the Custodian of the withdrawal of any Participant. As soon as
administratively reasonable after the effective date of a Participant’s
withdrawal from the Plan, the Corporation shall cause the balance of the
Participant’s Account, including without limitation certificates representing
the number of whole Common Shares therein and cash in lieu of any fractional
shares, to be paid to him or her. A Participant’s withdrawal from participation
in the Plan shall not prevent his or her further participation in the Plan. Any
Eligible Employee who withdraws from the Plan shall be entitled to resume
payroll deductions and become a Participant as of the next quarterly enrollment
period, as provided in Section 3.01(b).
Section 6.02. Involuntary Withdrawal. Upon termination of a Participant’s
employment with the Corporation or its Affiliates for any reason, including
resignation, discharge, disability or retirement, the balance of the
Participant’s Account, including without limitation certificates representing
the number of whole Common Shares therein and cash in lieu of any fractional
shares, shall be paid to him or her, or, in the case of his or her death, to his
or her beneficiary as provided in Section 6.04. The Corporation shall cause

 

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such amount to be paid as soon as administratively reasonable after such
termination of employment.
Section 6.03. Interest. No interest shall be payable in amounts held in a
Participant’s Account, or on amounts payable to a Participant or a beneficiary.
Section 6.04. Participant’s Beneficiary

  a)   A Participant may file with the Committee a written designation of a
beneficiary who is to receive any Common Shares or cash credited to the
Participant’s Account under the Plan in the event of the Participant’s death.
Such designation of beneficiary may be changed by the Participant at any time by
written notice.     b)   On the death of a Participant, and on receipt by the
Committee of reasonable proof of the identity and existence of the Participant’s
designated beneficiary, the Corporation shall cause the shares or cash provided
in Section 6.04(a), if any, to be delivered to such beneficiary as soon as
administratively reasonable. If a Participant dies without a surviving
designated beneficiary, the Corporation shall cause such shares or cash to be
delivered to the estate or a representative of the estate of the Participant.  
  c)   No designated beneficiary, and no heir or beneficiary of the estate, of a
deceased Participant shall acquire any interest in the Common Shares or cash
credited to the Participant’s Account under the Plan prior to the death of the
Participant.

ARTICLE
PLAN ADMINISTRATION
Section 7.01. Administrative Committee.

  a)   The Plan shall be administered, at the expense of the Corporation, by the
Committee. The Committee shall consist of not less than three (3) members, who
shall be appointed by the Board of Directors. Each member of the Committee shall
be either a director, officer or employee of the Corporation. Each member of the
Committee shall serve until removed by the Board of Directors and such removal
may be without cause and without advance notice.     b)   The Committee shall be
vested with full authority to make, administer and interpret such rules and
regulations as it deems necessary to administer the Plan. Any determination,
decision or action of the Committee in connection with the construction,
interpretation, administration, or application of the Plan shall be final,
conclusive and binding on all Participants, beneficiaries and any and all other
persons claiming under or through any Participant.

 

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  c)   The Committee shall keep or cause to be kept accurate and detailed
accounts of all contributions, receipts, disbursements and purchases of Common
Shares, and all accounts, books and records relating thereto shall be open to
inspection and audit at all reasonable times by any person designated by the
Board of Directors or the Committee.

Section 7.02. Custodian

  a)   The Board of Directors, in its sole discretion, shall appoint a
Custodian. The custodian may, but need not, be an Affiliate of the Corporation.
The Custodian may be removed by the Board of Directors at any time with thirty
(30) days prior notice in writing to the Custodian.     b)   The Custodian shall
maintain complete and accurate records of the number of whole and fractional
shares in each Participant’s Account and shall deliver certificates representing
such whole shares to the Participant upon receipt of written direction from the
Committee.

Section 7.03. Registration of Shares; Dividends.

  a)   Common Shares purchased for a Participant’s Account under this Plan may,
in the discretion of the Custodian, be registered in the name of its nominee.
The certificates for Common Shares to be delivered to Participants under the
Plan shall be registered in the name of the Participant or, if the Participant
so directs by written notice delivered to the Committee at least ten (10) days
prior to the Date of Exercise, in the names of the Participant and one other
person designated by the participant, as joint tenants with rights of
survivorship, to the extent permitted by applicable law. The Committee shall
timely notify the Custodian of its receipt of any such written notice.     b)  
All dividends paid with respect to the whole and fractional shares in a
Participant’s Account shall be credited to his or her Account and used to
purchase Common Shares on the next Date of Exercise.

Section 7.04. Transferability. Neither payroll deductions credited to a
Participant’s Account nor any rights with regard to the exercise of an option or
to receive Common Shares under the Plan may be assigned, transferred, pledged,
or otherwise disposed of in any way by the Participant, except with respect to
the death of the Participant as provided in Sections 6.02 and 6.04 or pursuant
to a qualified domestic relations order as defined by the Code, Title I of the
Employee Retirement Income Security Act of 1974, as amended, or the rules
thereunder. Any such attempted assignment, transfer, pledge, or other
disposition shall be without effect, except that the Committee, in it sole
discretion, may treat such act as an election to withdraw from the Plan.
Section 7.05. Separate Accounting for Payroll Deductions. No payroll deductions
received or held by the Corporation or any Affiliate under this Plan may be used
by the

 

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Corporation or the Affiliate for any corporate purpose, and the Corporation and
the Affiliate shall separately account for such payroll deductions.
Section 7.06. Only Employees Eligible to Participate. Notwithstanding any other
provision of this Plan, to be eligible to exercise an option a Participant shall
be an employee of the Corporation or its Affiliates at all times during the
period beginning with the date the option is granted and ending on the Date of
Exercise.
Section 7.07. Equal Rights and Privileges. Notwithstanding any other provision
of the Plan, all Eligible Employees shall have the same rights and privileges
under the Plan, as required by Code Section 423 and the regulations thereunder,
and the Committee shall administer the Plan and interpret and apply the
provisions of the Plan accordingly.
Section 7.08. Claims Procedures.

  a)   Any person who believes that he or she is entitled to any benefits under
this Plan shall present such claim in writing to the Committee. The Committee
shall within sixty (60) days provide adequate notice in writing to any claimant
as to the decision on any such claim. If such claim has been denied, in whole or
in part, such notice shall set forth: (i) the specific reasons for such denial;
(ii) specific reference to any pertinent provisions of the Plan on which denial
is based; (iii) a description of any additional material or information
necessary for the claimant to perfect the claim and an explanation of why such
material or information is necessary; and (iv) an explanation of the Plan’s
review procedure. Such notice shall be written in a manner calculated to be
understood by the claimant. Within sixty (60) days after receipt by the claimant
of notification of denial, the claimant shall have the right to present a
written appeal to the Committee. If such appeal is not filed within said sixty
(60) day period, the decision of the committee shall be final and binding. The
Committee shall act as a fiduciary in making a full and fair review of such
denial. The claimant or his or her duly authorized representative may review any
Plan documents which are pertinent to the claim and may submit issues and
comments to the Committee in writing.     b)   A decision by the Committee shall
be made promptly, and in any event not later than sixty (60) days after its
receipt of the appeal, provided, however, if the Committee decides a hearing at
which the claimant or his or her duly authorized representative may be present
is necessary and such a hearing is held, such decision shall be rendered as soon
as possible, but no later than one hundred twenty (120) days after its receipt
of the appeal. Any such decision of the Committee shall be in writing and
provide adequate notice to the claimant setting forth the specific reasons for
any denial and written in a manner calculated to be understood by a Participant.
Any such decision by the Committee shall be final.

ARTICLE
AMENDMENT AND TERMINATION

 

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Section 8.01. Recapitalization. The aggregate number of Common Shares which may
be issued hereunder shall be proportionately adjusted for any increase or
decrease in the number of issued and outstanding Common Shares resulting from a
subdivision or consolidation of shares of the Corporation or any other capital
adjustment of the Corporation, the payment of a share dividend, a share split or
any other increase or decrease in the Common Shares effected without receipt of
consideration by the Corporation. In the event that, prior to the purchase of
all of the Common Shares provided for herein, there shall be a capital
reorganization or reclassification of the capital of the Corporation resulting
in a substitution of other shares for the common shares, there shall be
substituted the number of substitute shares which would have been issued
pursuant to the option in exchange for the Common Shares then subject to the
option as if such Common Shares had been then issued and outstanding.
Section 8.02. Amendment and Termination

  a)   Except as provided in subsection (c) of this Section 8.02, the Board of
Directors of the Corporation, except any members participating in the Plan, may
from time to time, alter, amend, suspend or discontinue the Plan with respect to
any Common Shares for which an option has not been granted; provided, however,
that the Board of Directors may not, without further approval by the holders of
a majority of the issued and outstanding Common Shares of the Corporation who
are either present or represented and are entitled to vote at a meeting of
shareholders of the Corporation:

  1)   increase the maximum number of Common Shares that may be issued under the
Plan;     2)   change the class of shares which may be issued under the Plan;  
  3)   change the designation of the persons or class of persons eligible to
receive Common Shares under the Plan; or     4)   change the provisions of
Section 5.02 concerning the option price.

  b)   Unless earlier terminated by the Board of Directors pursuant to
subsection (a) of this Section 8.02, this Plan will terminate on the Date of
Exercise on which the remaining Common Shares reserved for the grant of options
under this Plan are not sufficient to enable each Participant on such date to
purchase at least one share. No option may be granted after the termination of
the Plan.     c)   Notwithstanding the provisions of subsection (a) of this
Section 8.02, the provisions of Sections 2.01(k) defining “Eligible Employee,”
Section 3.01 concerning participation in the Plan, Section 5.01(a) concerning
the timing and amount of the options granted to Participants, and Section 5.02
concerning the Option Price, shall not be amended more than once every six
months, other than to comport with changes

 

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      in the Code, the Employee Retirement Income Security Act of 1974, as
amended, or the rules thereunder.

ARTICLE
MISCELLANEOUS
Section 9.01. Notices. All notices or other communications by a Participant to
the Committee under or in connection with the Plan shall be deemed to have been
duly given when received by the Secretary of the Corporation, or when received
in the form and at the location or by the person specified by the Committee. Any
notices or other communications by the Committee to a Participant under or in
connection with the Plan shall be deemed to have been duly given when mailed by
the Committee to the address of the Participant on the business records of the
Corporation or its Affiliates.
Section 9.02. No Right to Continued Employment. Neither the establishment nor
the maintenance of the Plan nor any amendment thereof nor any act or omission
under the Plan or resulting from the operation of the Plan shall be construed as
giving any Eligible Employee the right to be retained in the service of the
Corporation or to interfere with the right of the Corporation to discharge any
Eligible Employee or any other person at any time in its discretion.

 

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AMENDMENT NO. 1 TO THE
IRWIN FINANCIAL CORPORATION
EMPLOYEES’ STOCK PURCHASE PLAN III
     This amendment should be read in conjunction with the Irwin Financial
Corporation Employees’ Stock Purchase Plan III (the “Plan”). Effective
September 21, 2001, the Plan is amended as follows:
     All references in the Plan to the National Association of Securities
Dealers Automated Quotation/National Mark System (“Nasdaq/NMS) now refer to the
New York Stock Exchange (“NYSE”).

 

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AMENDMENT NO. 2 TO THE
IRWIN FINANCIAL CORPORATION
EMPLOYEES’ STOCK PURCHASE PLAN III
          This amendment should be read in conjunction with the Irwin Financial
Corporation Employees’ Stock Purchase Plan III, as amended (the “Plan”).
Effective September 17, 2008 (the “Effective Date”), the Plan is amended as
follows:

1.   Section 3.02 (b) is hereby amended and restated in its entirety as follows:

     b) A Participant may suspend or change his or her payroll deduction in the
Plan effective as of any Payday by filing written notice with the Committee at
least fifteen (15) days prior to such Payday. A Participant’s suspension of his
or her payroll deductions shall not automatically result in his or her
withdrawal from participation in the Plan.

2.   Section 5.04 is hereby amended and restated in its entirety as follows:

Section 5.04. Interest in Shares. A Participant shall have no interest in or
rights as a shareholder with respect to Common Shares subject to an option
granted under this Plan until such option has been exercised and the number of
Common Shares purchased has been credited to the Participant’s Account. Upon
written request directed to the Committee, a Participant shall be entitled to:

  a)   receive a certificate representing the number of whole Common Shares
and/or cash from the sale proceeds, in any, in lieu of any fractional shares
credited to the Participant’s Account. Upon receipt of any such request, the
Committee shall promptly direct the Custodian to distribute such certificates,
if any, and the Corporation to pay such cash, if any, to the Participant; or    
b)   direct, in writing, the Custodian to sell all or a portion of Common Shares
credited to the Participant’s Account in accordance with Section 5.06 of the
Plan.

3.   Section 5.05 is hereby amended and restated in its entirety as follows:

Section 5.05. Fractional Shares. A Participant shall be entitled to participate
in any dividend or other distribution with respect to any fractional share
credited to the Participant’s Account, but shall have no right to vote any
fractional share. No certificates will be issued representing fractional shares
purchased pursuant to the Plan. Upon a Participant’s withdrawal from the Plan
under Article VI or Section 7.04 or upon the Committee’s receipt of a request to
issue certificates pursuant to Section 5.04, cash from the sale proceeds, if
any, will be paid in lieu of any fractional share held in a Participant’s
Account.

4.   A new Section 5.06 is hereby added to the Plan:

 

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Section 5.06. Sale of Shares. Upon a Participant’s written request and unless
prohibited by law, regulation, or administrative rule of the Committee,
Custodian shall sell all or a portion of the whole Common Shares credited to a
Participant’s account. Custodian shall sell such shares on the next regularly
scheduled sale date as specified by the Custodian. As soon as administratively
reasonable after the sale of the Common Shares, the Custodian shall cause the
Participant to receive the cash value of the amount of Common Shares sold and
any fractional shares attributed to the Participant’s account, if applicable,
less any fees associated with the sale of the Common Shares. A Participant may
sell all or a portion of the Common Shares credited to his or her account
pursuant to this Section 5.06 without withdrawing from participation in the
Plan.

5.   Section 6.01 of the Plan is hereby amended and restated in its entirety as
follows:

Section 6.01. Voluntary Withdrawal. A Participant may withdraw from
participation in the Plan as of any Payday by delivering written notice to the
Committee at least fifteen (15) days prior to such Payday, provided the
Participant is otherwise eligible. The Committee shall promptly notify the
Custodian of the withdrawal of any Participant. As soon as administratively
reasonable after the effective date of the Participant’s withdrawal from the
Plan, the Corporation shall, at the Participant’s written election, cause
either:

  a)   the balance of the Participant’s Account, including without limitation
certificates representing the number of whole Common Shares therein and cash
from the sale proceeds, if any, in lieu of any fractional shares, to be paid to
him or her; or     b)   the Custodian to sell the number of Common Shares
credited to the Participant’s account in accordance with Section 5.06 of the
Plan.

A Participant’s withdrawal from participation in the Plan shall not prevent his
or her further participation in the Plan. Any Eligible Employee who withdraws
from the Plan shall be entitled to resume payroll deductions and become a
Participant as of the next quarterly enrollment period, as provided in
Section 3.01(b).

6.   Section 6.02 of the Plan is hereby amended and restated in its entirety as
follows:

Section 6.02. Involuntary Withdrawal. Upon termination of a Participant’s
employment with the Corporation or its Affiliates for any reason, including
resignation, discharge, disability or retirement, the balance of the
Participant’s Account, including without limitation certificates representing
the number of whole Common Shares therein and cash from the sale proceeds, if
any, in lieu of any fractional shares, shall be paid to him or her, or in the
case of his or her death, to his or her beneficiary as provided in Section 6.04;
provided, however, at Participant’s election, the Corporation shall cause the
Custodian to sell the number of Common Shares credited to the Participant’s
account as of the date of termination in accordance with Section 5.06 of the
Plan. The Corporation shall cause such amount to be paid or sold by Custodian,
as the case may be, as soon as administratively reasonable after such
termination of employment.

 

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7.   Except as specifically amended herein, all other terms and conditions
contained in the Plan shall remain unchanged and shall continue in full force
and effect.

     IN WITNESS WHEREOF, the Board of Directors has caused this Amendment No. 2
to the Irwin Financial Corporation Employee Stock Purchase Plan III, as amended,
to be amended effective the Effective Date.

            IRWIN FINANCIAL CORPORATION
      By:   /s/ Matthew F. Souza         Printed:   Matthew F. Souza        Its:
   Chief Administrative Officer