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                         FIRST BANCORP OF INDIANA, INC.
                         1999 STOCK-BASED INCENTIVE PLAN


1.       DEFINITIONS.
         -----------

         (a)      "Affiliate"  means any  "parent  corporation"  or  "subsidiary
corporation"  of the  Holding  Company,  as such terms are  defined in  Sections
424(e) and 424(f) of the Code.

         (b)      "Award" means, individually or collectively, a grant under the
Plan of Non-Statutory Stock Options, Incentive Stock Options and Stock Awards.

         (c)      "Award  Agreement"  means an agreement  evidencing and setting
forth the terms of an Award.

         (d)      "Bank" means First Federal Savings Bank.

         (e)      "Board  of  Directors"  means the  board of  directors  of the
Holding Company.

         (f)      "Change in Control" of the Holding  Company or the Bank means:
(i) an event of a nature  that would be  required  to be reported in response to
Item 1(a) of the current  report on Form 8-K,  as in effect on the date  hereof,
pursuant  to  Section  13 or 15(d) of the  Exchange  Act;  or (ii) an event that
results  in a change in control of the Bank or the  Holding  Company  within the
meaning of the Home Owners' Loan Act of 1933,  as amended,  the Federal  Deposit
Insurance Act, and the rules and regulations promulgated by the Office of Thrift
Supervision  (or its  predecessor  agency),  as in  effect  on the  date  hereof
(provided,  that in applying  the  definition  of change in control as set forth
under  the rules  and  regulations  of the OTS,  the  Board of  Directors  shall
substitute its judgment for that of the OTS); or (iii) 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 voting securities of the Bank or the
Holding Company  representing 20% or more of the Bank's or the Holding Company's
outstanding voting securities or the right to acquire such securities except for
any voting  securities  of the Bank  purchased  by the  Holding  Company and any
voting securities  purchased by any employee benefit plan of the Holding Company
or its Subsidiaries, or (B) individuals who constitute the Board of Directors 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 at least
three-quarters  of the  directors  comprising  the  Incumbent  Board,  or  whose
nomination for election by the Holding Company's  stockholders was approved by a
Nominating  Committee  solely  composed  of members  which are  Incumbent  Board
members,  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 Bank
or the Holding Company or similar  transaction occurs or is effectuated in which
the Bank or Holding Company is not the resulting entity; provided, however, that
such an event  listed  above  will be  deemed to have  occurred  or to have been
effectuated  upon the receipt of all required federal  regulatory  approvals not
including the lapse of any statutory  waiting periods,  or (D) a proxy statement
has  been  distributed  soliciting  proxies  from  stockholders  of the  Holding
Company,  by someone other than the current  management of the Holding  Company,
seeking   stockholder   approval  of  a  plan  of   reorganization,   merger  or
consolidation of the Holding Company or Bank with one or more  corporations as a
result of which the  outstanding  shares of the class of securities then subject
to such plan or transaction are exchanged for or converted into cash or property
or  securities  not issued by the Bank or the Holding  Company,  or (E) a tender
offer is made for 20% or more of the  voting  securities  of the Bank or Holding
Company then outstanding by a person other than the Bank or Holding Company.

         (g)      "Code" means the Internal Revenue Code of 1986, as amended.

         (h)      "Committee"  means the  committee  designated  by the Board of
Directors, pursuant to Section 2 of the Plan, to administer the Plan.
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         (i)      "Common Stock" means the common stock of the Holding  Company,
par value $.01 per share.

         (j)      "Date of Grant" means the effective date of an Award.

         (k)      "Disability"  means any  mental  or  physical  condition  with
respect to which the Participant qualifies for and receives benefits for under a
long-term  disability  plan of the Holding  Company or an  Affiliate,  or in the
absence  of such a  long-term  disability  plan or  coverage  under such a plan,
"Disability"  shall  mean a  physical  or mental  condition  which,  in the sole
discretion of the Committee, is reasonably expected to be of indefinite duration
and to  substantially  prevent the Participant from fulfilling his or her duties
or responsibilities to the Holding Company or an Affiliate.

         (l)      "Effective  Date" means April 8, 2000,  but only if,  prior to
such date, the Plan is approved by the Holding Company's shareholders.  The Plan
will be so  approved  if at an annual or special  meeting of  shareholders  held
prior to such date a quorum is  present  and the  majority  of the votes cast at
such  meeting by the  holders of the Common  Stock shall be cast in favor of its
approval.

         (m)      "Employee" means any person employed by the Holding Company or
an Affiliate.  Directors who are employed by the Holding Company or an Affiliate
shall be considered Employees under the Plan.

         (n)      "Exchange Act" means the  Securities  Exchange Act of 1934, as
amended.

         (o)      "Exercise  Price" means the price at which a  Participant  may
purchase a share of Common Stock pursuant to an Option.

         (p)      "Fair Market  Value"  means the market price of Common  Stock,
determined by the Committee as follows:

                  (i)      If  the  Common  Stock  was  traded  on the  date  in
                           question  on The Nasdaq  Stock  Market  then the Fair
                           Market  Value  shall be equal  to the  closing  price
                           reported for such date;

                  (ii)     If the Common Stock was traded on a stock exchange on
                           the date in  question,  then the  Fair  Market  Value
                           shall be equal to the closing  price  reported by the
                           applicable  composite  transactions  report  for such
                           date; and

                  (iii)    If neither of the foregoing provisions is applicable,
                           then the Fair Market Value shall be determined by the
                           Committee  in good  faith  on such  basis as it deems
                           appropriate.

         Whenever  possible,  the  determination  of Fair  Market  Value  by the
Committee shall be based on the prices reported in The Wall Street Journal.  The
Committee's  determination  of Fair Market Value shall be conclusive and binding
on all persons.

         (q)      "Holding Company" means First Bancorp of Indiana, Inc.

         (r)      "Incentive  Stock  Option"  means a stock option  granted to a
Participant,  pursuant  to Section 7 of the Plan,  that is  intended to meet the
requirements of Section 422 of the Code.

         (s)      "Non-Statutory Stock Option" means a stock option granted to a
Participant  pursuant  to the terms of the Plan but which is not  intended to be
and is not  identified  as an Incentive  Stock Option or a stock option  granted
under the Plan which is intended to be and is identified  as an Incentive  Stock
Option but which does not meet the requirements of Section 422 of the Code.

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         (t)      "Option"  means an  Incentive  Stock  Option or  Non-Statutory
Stock Option.

         (u)      "Outside Director" means a member of the board(s) of directors
of the  Holding  Company  or an  Affiliate  who is not also an  Employee  of the
Holding Company or an Affiliate.

         (v)      "Participant" means any person who holds an outstanding Award.

         (w)      "Plan"  means  this  First  Bancorp  of  Indiana,   Inc.  1999
Stock-Based Incentive Plan.

         (x)      "Retirement" means retirement from employment with the Holding
Company or an Affiliate in accordance with the then current retirement  policies
of the Holding Company or Affiliate, as applicable. "Retirement" with respect to
an Outside  Director  means the  termination  of service  from the  board(s)  of
directors of the Holding Company and any Affiliate  following  written notice to
such board(s) of directors of the Outside Director's intention to retire.

         (y)      "Stock Award" means an Award granted to a Participant pursuant
to Section 8 of the Plan.

         (z)      "Termination  for  Cause"  means  termination   because  of  a
Participant's personal dishonesty,  incompetence,  willful misconduct, breach of
fiduciary duty involving personal profit,  intentional failure to perform stated
duties,  willful  violation of any law, rule or  regulation  (other than traffic
violations  or similar  offenses)  or material  breach of any  provision  of any
employment  agreement  between the Holding  Company and/or any subsidiary of the
Holding Company and a Participant.

         (aa)     "Trust" means a trust established by the Board of Directors in
connection  with  this  Plan to hold  Common  Stock  or other  property  for the
purposes set forth in the Plan.

         (bb)     "Trustee"  means any person or entity approved by the Board of
Directors or its designee(s) to hold any of the Trust assets.

2.       ADMINISTRATION.
         --------------

         (a)      The Committee  shall  administer the Plan. The Committee shall
consist of two or more disinterested directors of the Holding Company, who shall
be appointed by the Board of Directors. A member of the Board of Directors shall
be deemed to be "disinterested" only if he or she satisfies such requirements as
the Securities and Exchange Commission may establish for non-employee  directors
administering  plans intended to qualify for exemption  under Rule 16b-3 (or its
successor) under the Exchange Act.

         (b)      The  Committee  shall (i) select  the  Employees  and  Outside
Directors  who are to receive  Awards under the Plan,  (ii)  determine the type,
number,  vesting  requirements and other features and conditions of such Awards,
(iii) interpret the Plan and Award  Agreements in all respects and (iv) make all
other  decisions  relating to the operation of the Plan. The Committee may adopt
such rules or guidelines  as it deems  appropriate  to implement  the Plan.  The
Committee's  determinations  under the Plan  shall be final and  binding  on all
persons.

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         (c)      Each Award shall be evidenced by a written  agreement  ("Award
Agreement")  containing  such  provisions  as may be  required  by the  Plan and
otherwise  approved by the Committee.  Each Award Agreement  shall  constitute a
binding   contract   between  the  Holding  Company  or  an  Affiliate  and  the
Participant, and every Participant, upon acceptance of an Award Agreement, shall
be bound by the terms and restrictions of the Plan and the Award Agreement.  The
terms of each Award  Agreement  shall be in accordance  with the Plan,  but each
Award  Agreement  may  include  any  additional   provisions  and   restrictions
determined by the Committee,  in its  discretion,  provided that such additional
provisions and restrictions are not inconsistent  with the terms of the Plan. In
particular  and at a  minimum,  the  Committee  shall  set  forth in each  Award
Agreement: (i) the type of Award granted; (ii) the Exercise Price of any Option;
(iii) the number of shares subject to the Award; (iv) the expiration date of the
Award;  (v) the manner,  time, and rate (cumulative or otherwise) of exercise or
vesting of such  Award;  and (vi) the  restrictions,  if any,  placed  upon such
Award,  or upon  shares  which may be issued upon  exercise  of such Award.  The
Chairman of the  Committee  and such other  directors  and  officers as shall be
designated by the Committee is hereby  authorized to execute Award Agreements on
behalf of the Company or an  Affiliate  and to cause them to be delivered to the
recipients of Awards.

         (d)      The  Committee  may  delegate  all  authority   for:  (i)  the
determination of forms of payment to be made by or received by the Plan and (ii)
the execution of any Award Agreement.

3.       TYPES OF AWARDS.
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         The following Awards may be granted under the Plan:

         (a)      Non-Statutory Stock Options.

         (b)      Incentive Stock Options.

         (c)      Stock Awards.

4.       STOCK SUBJECT TO THE PLAN.
         -------------------------

         Subject to adjustment as provided in Section 13 of the Plan, the number
of shares  reserved for Awards under the Plan is 318,136.  Subject to adjustment
as provided in Section 13 of the Plan, the number of shares  reserved hereby for
purchase  pursuant to the exercise of Options granted under the Plan is 227,240.
The  number of the shares  reserved  for Stock  Awards is 90,896.  The shares of
Common Stock issued under the Plan may be either  authorized but unissued shares
or authorized shares previously issued and acquired or reacquired by the Trustee
or the  Holding  Company,  respectively.  To the extent  that  Options and Stock
Awards are granted  under the Plan,  the shares  underlying  such Awards will be
unavailable  for any other use  including  future  grants  under the Plan except
that,  to the extent  that  Stock  Awards or  Options  terminate,  expire or are
forfeited without having vested or without having been exercised, new Awards may
be made with respect to these shares.

5.       ELIGIBILITY.
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         Subject to the terms of the Plan,  all Employees and Outside  Directors
shall be eligible to receive  Awards under the Plan. In addition,  the Committee
may grant  eligibility to consultants  and advisors of the Holding Company or an
Affiliate, as it sees fit.

6.       NON-STATUTORY STOCK OPTIONS.
         ---------------------------

         The  Committee  may,  subject  to the  limitations  of the Plan and the
availability of shares of Common Stock reserved but not previously awarded under
the Plan, grant  Non-Statutory  Stock Options to eligible  individuals upon such
terms and conditions as it may determine to the extent such terms and conditions
are consistent with the following provisions:

         (a)      Exercise  Price.  The Committee  shall  determine the Exercise
Price of each Non-Statutory Stock Option.  However, the Exercise Price shall not
be less than 100% of the Fair  Market  Value of the Common  Stock on the Date of
Grant.

         (b)      Terms of  Non-statutory  Stock  Options.  The Committee  shall
determine the term during which a Participant may exercise a Non-Statutory Stock
Option, but in no event may a Participant exercise a Non-Statutory Stock Option,
in whole or in part,  more  than ten  (10)  years  from the Date of  Grant.  The
Committee  shall  also  determine  the date on which  each  Non-Statutory  Stock
Option, or any part thereof, first

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becomes  exercisable  and any terms or conditions a Participant  must satisfy in
order to exercise each  Non-Statutory  Stock Option.  The shares of Common Stock
underlying each Non-Statutory  Stock Option may be purchased in whole or in part
by the  Participant  at any time  during  the term of such  Non-Statutory  Stock
Option,  or any portion  thereof,  once the  Non-Statutory  Stock Option becomes
exercisable.

         (c)      Non-Transferability.   Unless  otherwise   determined  by  the
Committee in accordance  with this Section 6(c), a Participant may not transfer,
assign, hypothecate, or dispose of in any manner, other than by will or the laws
of intestate  succession,  a  Non-Statutory  Stock Option.  The  Committee  may,
however,  in its sole  discretion,  permit  transferability  or  assignment of a
Non-Statutory  Stock  Option  if such  transfer  or  assignment  is, in its sole
determination,   for  valid  estate  planning  purposes  and  such  transfer  or
assignment  is permitted  under the Code and Rule 16b-3 under the Exchange  Act.
For purposes of this Section 6(c), a transfer for valid estate planning purposes
includes,  but is not limited to: (a) a transfer to a revocable intervivos trust
as to which the  Participant is both the settlor and trustee,  or (b) a transfer
for no consideration to: (i) any member of the  Participant's  Immediate Family,
(ii) any trust solely for the benefit of members of the Participant's  Immediate
Family,   (iii)  any  partnership   whose  only  partners  are  members  of  the
Participant's  Immediate Family,  and (iv) any limited liability  corporation or
corporate  entity  whose  only  members  or equity  owners  are  members  of the
Participant's  Immediate Family.  For purposes of this Section 6(c),  "Immediate
Family" includes,  but is not necessarily  limited to, a Participant's  parents,
grandparents, spouse, children, grandchildren,  siblings (including half bothers
and  sisters),  and  individuals  who are family  members by  adoption.  Nothing
contained in this  Section  6(c) shall be construed to require the  Committee to
give its  approval to any  transfer or  assignment  of any  Non-Statutory  Stock
Option or portion thereof,  and approval to transfer or assign any Non-Statutory
Stock Option or portion  thereof does not mean that such  approval will be given
with respect to any other  Non-Statutory  Stock Option or portion  thereof.  The
transferee or assignee of any Non-Statutory Stock Option shall be subject to all
of the  terms and  conditions  applicable  to such  Non-Statutory  Stock  Option
immediately  prior to the  transfer  or  assignment  and shall be subject to any
other conditions  proscribed by the Committee with respect to such Non-Statutory
Stock Option.

         (d)      Termination  of  Employment  or  Service   (General).   Unless
otherwise  determined by the Committee,  upon the termination of a Participant's
employment or other service for any reason other than Retirement,  Disability or
death,  a Change in Control,  or  Termination  for Cause,  the  Participant  may
exercise  only  those   Non-Statutory   Stock  Options  that  were   immediately
exercisable by the  Participant at the date of such  termination  and only for a
period  of three  (3)  months  following  the date of such  termination,  or, if
sooner, until the expiration of the term of the Option.

         (e)      Termination  of  Employment  or Service  (Retirement).  Unless
otherwise  determined  by  the  Committee,  in  the  event  of  a  Participant's
Retirement,  the Participant may exercise only those Non-Statutory Stock Options
that were  immediately  exercisable by the Participant at the date of Retirement
and only for a period of one (1) year from the date of Retirement or, if sooner,
until the expiration of the term of the Option.

         (f)      Termination  of Employment or Service  (Disability  or Death).
Unless otherwise determined by the Committee, in the event of the termination of
a  Participant's  employment or other  service due to  Disability or death,  all
Non-Statutory  Stock Options held by such Participant shall  immediately  become
exercisable and remain  exercisable for a period one (1) year following the date
of such  termination,  or, if sooner,  until the  expiration  of the term of the
Option.

         (g)      Termination of Employment or Service  (Termination for Cause).
Unless  otherwise  determined by the Committee,  in the event of a Participant's
Termination   for  Cause,   all  rights  with   respect  to  the   Participant's
Non-Statutory  Stock Options shall expire immediately upon the effective date of
such Termination for Cause.

         (h)      Acceleration  Upon a  Change  in  Control.  In the  event of a
Change in Control all  Non-Statutory  Stock Options held by a Participant  as of
the date of the Change in Control shall immediately become exercisable and shall
remain  exercisable until the expiration of the term of the Non-Statutory  Stock
Options.

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         (i)      Payment.  Payment due to a Participant  upon the exercise of a
Non-Statutory Stock Option shall be made in the form of shares of Common Stock.

7.       INCENTIVE STOCK OPTIONS.
         -----------------------

         The  Committee  may,  subject  to the  limitations  of the Plan and the
availability  of shares of Common Stock reserved but unawarded  under this Plan,
grant  Incentive  Stock Options to an Employee upon such terms and conditions as
it may determine to the extent such terms and conditions are consistent with the
following provisions:

         (a)      Exercise  Price.  The Committee  shall  determine the Exercise
Price of each Incentive Stock Option.  However,  the Exercise Price shall not be
less  than  100% of the Fair  Market  Value of the  Common  Stock on the Date of
Grant;  provided,  however,  that if at the time an  Incentive  Stock  Option is
granted,  the Employee owns or is treated as owning, for purposes of Section 422
of the Code,  Common  Stock  representing  more  than 10% of the total  combined
voting securities of the Holding Company ("10% Owner"), the Exercise Price shall
not be less than 110% of the Fair Market  Value of the Common  Stock on the Date
of Grant.

         (b)      Amounts  of  Incentive  Stock  Options.   To  the  extent  the
aggregate  Fair  Market  Value of shares of Common  Stock with  respect to which
Incentive  Stock Options that are  exercisable for the first time by an Employee
during any  calendar  year under the Plan and any other stock option plan of the
Holding Company or an Affiliate exceeds $100,000, or such higher value as may be
permitted  under  Section 422 of the Code,  such Options in excess of such limit
shall be treated as  Non-Statutory  Stock  Options.  Fair Market  Value shall be
determined  as of the Date of Grant with  respect to each such  Incentive  Stock
Option.

         (c)      Terms  of  Incentive   Stock  Options.   The  Committee  shall
determine  the term during which a Participant  may exercise an Incentive  Stock
Option, but in no event may a Participant exercise an Incentive Stock Option, in
whole or in part,  more than ten (10)  years  from the Date of Grant;  provided,
however, that if at the time an Incentive Stock Option is granted to an Employee
who is a 10% Owner,  the Incentive  Stock Option  granted to such Employee shall
not be  exercisable  after the  expiration  of five (5)  years  from the Date of
Grant. The Committee shall also determine the date on which each Incentive Stock
Option,  or any  part  thereof,  first  becomes  exercisable  and any  terms  or
conditions a Participant  must satisfy in order to exercise each Incentive Stock
Option. The shares of Common Stock underlying each Incentive Stock Option may be
purchased  in  whole or in part at any time  during  the term of such  Incentive
Stock Option after such Option becomes exercisable.

         (d)      Non-Transferability.   No  Incentive  Stock  Option  shall  be
transferable  except  by will or the laws of  descent  and  distribution  and is
exercisable,  during  his or her  lifetime,  only by the  Employee  to whom  the
Committee  grants the Incentive  Stock Option.  The designation of a beneficiary
does not constitute a transfer of an Incentive Stock Option.

         (e)      Termination   of  Employment   (General).   Unless   otherwise
determined by the Committee,  upon the termination of a Participant's employment
or other service for any reason other than  Retirement,  Disability or death,  a
Change in Control,  or Termination for Cause,  the Participant may exercise only
those  Incentive  Stock  Options  that  were  immediately   exercisable  by  the
Participant at the date of such  termination  and only for a period of three (3)
months  following  the  date of such  termination,  or,  if  sooner,  until  the
expiration of the term of the Option.

         (f)      Termination  of  Employment  (Retirement).   Unless  otherwise
determined by the Committee,  in the event of a  Participant's  Retirement,  the
Participant   may  exercise  only  those   Incentive  Stock  Options  that  were
immediately  exercisable  by the  Participant at the date of Retirement and only
for a period of one (1) year from the date of Retirement,  or, if sooner,  until
the expiration of the term of the Option. Any Option originally designated as an
Incentive Stock Option shall be treated as a  Non-Statutory  Stock Option to the
extent the Option does not

                                       6
<PAGE>
otherwise  qualify as an Incentive  Stock Option  pursuant to Section 422 of the
Code.

         (g)      Termination  of  Employment   (Disability  or  Death).  Unless
otherwise  determined by the  Committee,  in the event of the  termination  of a
Participant's  employment  or other  service  due to  Disability  or death,  all
Incentive  Stock  Options  held by such  Participant  shall  immediately  become
exercisable and remain  exercisable for a period one (1) year following the date
of such  termination,  or, if sooner,  until the  expiration  of the term of the
Option.

         (h)      Termination  of  Employment  (Termination  for Cause).  Unless
otherwise determined by the Committee, in the event of an Employee's Termination
for Cause, all rights under such Employee's Incentive Stock Options shall expire
immediately upon the effective date of such Termination for Cause.

         (i)      Acceleration  Upon a  Change  in  Control.  In the  event of a
Change in Control all Incentive  Stock  Options held by a Participant  as of the
date of the Change in Control shall  immediately  become  exercisable  and shall
remain  exercisable  until the  expiration  of the term of the  Incentive  Stock
Options. Any Option originally  designated as an Incentive Stock Option shall be
treated as a  Non-Statutory  Stock  Option to the  extent  the  Option  does not
otherwise  qualify as an Incentive  Stock Option  pursuant to Section 422 of the
Code.

         (j)      Payment.  Payment due to a Participant upon the exercise of an
Incentive Stock Option shall be made in the form of shares of Common Stock.

         (k)      Disqualifying Dispositions.  Each Award Agreement with respect
to an  Incentive  Stock  Option  shall  require  the  Participant  to notify the
Committee of any  disposition  of shares of Common Stock issued  pursuant to the
exercise of such Option under the  circumstances  described in Section 421(b) of
the Code (relating to certain disqualifying dispositions) within 10 days of such
disposition.

8.        STOCK AWARDS.
          ------------

         The Committee  may make grants of Stock Awards,  which shall consist of
the grant of some number of shares of Common Stock,  to a Participant  upon such
terms and conditions as it may determine to the extent such terms and conditions
are consistent with the following provisions:

         (a)      Grants of the Stock  Awards.  Stock Awards may only be made in
whole  shares of Common  Stock.  Stock  Awards may only be granted  from  shares
reserved  under the Plan and  available for award at the time the Stock Award is
made to the Participant.

         (b)      Terms of the Stock Awards.  The Committee  shall determine the
dates on which Stock Awards granted to a Participant shall vest and any terms or
conditions  which must be  satisfied  prior to the vesting of any Stock Award or
portion  thereof.  Any such  terms or  conditions  shall  be  determined  by the
Committee as of the Date of Grant.

         (c)      Termination  of  Employment  or  Service   (General).   Unless
otherwise  determined by the Committee,  upon the termination of a Participant's
employment or service for any reason other than Retirement, Disability or death,
a Change in Control,  or  Termination  for Cause,  any Stock Awards in which the
Participant  has not become vested as of the date of such  termination  shall be
forfeited and any rights the  Participant  had to such Stock Awards shall become
null and void.

         (d)      Termination  of  Employment  or Service  (Retirement).  Unless
otherwise  determined  by  the  Committee,  in  the  event  of  a  Participant's
Retirement,  any Stock Awards in which the  Participant has not become vested as
of the date of Retirement  shall be forfeited and any rights the Participant had
to such unvested Stock Awards shall become null and void.

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<PAGE>
         (e)      Termination  of Employment or Service  (Disability  or Death).
Unless otherwise  determined by the Committee,  in the event of a termination of
the  Participant's  service due to Disability or death all unvested Stock Awards
held  by  such  Participant  shall  immediately  vest  as of the  date  of  such
termination.

         (f)      Termination of Employment or Service  (Termination for Cause).
Unless otherwise determined by the Committee,  in the event of the Participant's
Termination for Cause,  all Stock Awards in which the Participant had not become
vested as of the effective date of such Termination for Cause shall be forfeited
and any rights such  Participant  had to such unvested Stock Awards shall become
null and void.

         (g)      Acceleration  Upon a  Change  in  Control.  In the  event of a
Change  in  Control  all  unvested  Stock  Awards  held by a  Participant  shall
immediately vest.

         (h)      Issuance of  Certificates.  Unless otherwise held in Trust and
registered  in the name of the Trustee,  reasonably  promptly  after the Date of
Grant with  respect to shares of Common  Stock  pursuant to a Stock  Award,  the
Holding Company shall cause to be issued a stock certificate,  registered in the
name of the  Participant to whom such Stock Award was granted,  evidencing  such
shares;  provided,  that  the  Holding  Company  shall  not  cause  such a stock
certificate  to be issued  unless it has received a stock power duly endorsed in
blank with respect to such shares.  Each such stock  certificate  shall bear the
following legend:

                  "The  transferability  of this  certificate  and the shares of
                  stock  represented  hereby are  subject  to the  restrictions,
                  terms and  conditions  (including  forfeiture  provisions  and
                  restrictions  against transfer) contained in the First Bancorp
                  of Indiana,  Inc. 1999  Stock-Based  Incentive  Plan and Award
                  Agreement  entered into between the  registered  owner of such
                  shares and First Bancorp of Indiana, Inc. or its Affiliates. A
                  copy of the Plan and Award  Agreement is on file in the office
                  of the Corporate  Secretary of First Bancorp of Indiana,  Inc.
                  located  at 2200 West  Franklin  Street,  Evansville,  Indiana
                  47712.

Such legend shall not be removed until the  Participant  becomes  vested in such
shares pursuant to the terms of the Plan and Award  Agreement.  Each certificate
issued pursuant to this Section 8(h), in connection with a Stock Award, shall be
held by the Holding Company or its Affiliates,  unless the Committee  determines
otherwise.

         (i)      Non-Transferability.  Except to the  extent  permitted  by the
Code,  the rules  promulgated  under  Section  16(b) of the  Exchange Act or any
successor statutes or rules:

                  (i)      The  recipient  of a  Stock  Award  shall  not  sell,
                           transfer,   assign,  pledge,  or  otherwise  encumber
                           shares  subject to the Stock Award until full vesting
                           of such  shares has  occurred.  For  purposes of this
                           section,  the separation of beneficial  ownership and
                           legal title through the use of any "swap" transaction
                           is deemed to be a prohibited encumbrance.

                  (ii)     Unless  determined  otherwise  by the  Committee  and
                           except  in the  event of the  Participant's  death or
                           pursuant to a domestic relations order, a Stock Award
                           is not  transferable  and may be earned in his or her
                           lifetime  only  by  the  Participant  to  whom  it is
                           granted.  Upon the  death of a  Participant,  a Stock
                           Award is  transferable by will or the laws of descent
                           and  distribution.  The  designation of a beneficiary
                           shall not constitute a transfer.

                  (iii)    If a  recipient  of a Stock  Award is  subject to the
                           provisions of Section 16 of the Exchange Act,  shares
                           of Common Stock  subject to such Stock Award may not,
                           without the written  consent of the Committee  (which
                           consent may be given in the Award


                                       8
<PAGE>

                           Agreement),  be sold or otherwise  disposed of within
                           six (6)  months  following  the  date of grant of the
                           Stock Award.

         (j)      Accrual of  Dividends.  To the extent Stock Awards are held in
Trust and registered in the name of the Trustee,  unless otherwise  specified by
the Trust  agreement,  whenever shares of Common Stock  underlying a Stock Award
are  distributed to a Participant or  beneficiary  thereof under the Plan,  such
Participant  or beneficiary  shall also be entitled to receive,  with respect to
each such  share  distributed,  a payment  equal to any cash  dividends  and the
number of shares of Common Stock equal to any stock dividends, declared and paid
with respect to a share of the Common  Stock if the record date for  determining
shareholders  entitled  to receive  such  dividends  falls  between the date the
relevant  Stock  Award was  granted  and the date the  relevant  Stock  Award or
installment  thereof is issued.  There shall also be  distributed an appropriate
amount of net earnings,  if any, of the Trust with respect to any dividends paid
out on the shares related to the Stock Award.

         (k)      Voting of Stock  Awards.  After a Stock Award has been granted
but for which the shares  covered by such Stock Award have not yet been  vested,
earned and distributed to the Participant  pursuant to the Plan, the Participant
shall be entitled to vote or to direct the Trustee to vote,  as the case may be,
such shares of Common  Stock which the Stock Award  covers  subject to the rules
and  procedures  adopted  by the  Committee  for  this  purpose  and in a manner
consistent with the Trust agreement.

         (l)      Payment. Payment due to a Participant upon the redemption of a
Stock Award shall be made in the form of shares of Common Stock.

9.       DEFERRED PAYMENTS.
         -----------------

         The Committee, in its discretion,  may permit a Participant to elect to
defer receipt of all or any part of any cash or stock payment under the Plan, or
the Committee may determine to defer receipt by some or all Participants, of all
or part of any such  payment.  The  Committee  shall  determine  the  terms  and
conditions of any such deferral, including the period of deferral, the manner of
deferral,  and the method for measuring  appreciation on deferred  amounts until
their payout.

10.       METHOD OF EXERCISE OF OPTIONS.
          -----------------------------

         Subject to any applicable Award Agreement,  any Option may be exercised
by the  Participant  in  whole  or in  part  at  such  time  or  times,  and the
Participant  may  make  payment  of the  Exercise  Price  in such  form or forms
permitted by the Committee,  including, without limitation,  payment by delivery
of cash, Common Stock or other consideration (including,  where permitted by law
and the  Committee,  Awards)  having a Fair Market Value on the day  immediately
preceding  the  exercise  date  equal to the  total  Exercise  Price,  or by any
combination of cash, shares of Common Stock and other  consideration,  including
exercise  by  means  of  a  cashless  exercise  arrangement  with  a  qualifying
broker-dealer, as the Committee may specify in the applicable Award Agreement.

11.      RIGHTS OF PARTICIPANTS.
         ----------------------

         No Participant  shall have any rights as a shareholder  with respect to
any shares of Common Stock  covered by an Option until the date of issuance of a
stock  certificate  for such Common Stock.  Nothing  contained  herein or in any
Award  Agreement  confers on any person any right to  continue  in the employ or
service of the Holding Company or an Affiliate or interferes in any way with the
right of the  Holding  Company or an  Affiliate  to  terminate  a  Participant's
services.

                                       9
<PAGE>
12.      DESIGNATION OF BENEFICIARY.
         --------------------------

         A  Participant  may,  with the  consent of the  Committee,  designate a
person or  persons  to  receive,  in the event of death,  any Award to which the
Participant  would then be entitled.  Such  designation  will be made upon forms
supplied by and delivered to the Holding  Company and may be revoked in writing.
If a  Participant  fails  effectively  to  designate  a  beneficiary,  then  the
Participant's estate will be deemed to be the beneficiary.

13.      DILUTION AND OTHER ADJUSTMENTS.
         ------------------------------

         In the event of any change in the outstanding shares of Common Stock by
reason of any stock dividend or split, recapitalization,  merger, consolidation,
spin-off,  reorganization,  combination or exchange of shares,  or other similar
corporate  change,  or other increase or decrease in such shares without receipt
or  payment  of  consideration  by  the  Holding  Company,  or in the  event  an
extraordinary  capital  distribution  is  made,  the  Committee  may  make  such
adjustments to previously  granted Awards, to prevent dilution,  diminution,  or
enlargement  of the  rights  of  the  Participant,  including  any or all of the
following:

         (a)      adjustments  in the  aggregate  number  or kind of  shares  of
                  Common  Stock or other  securities  that may  underlie  future
                  Awards under the Plan;

         (b)      adjustments  in the  aggregate  number  or kind of  shares  of
                  Common Stock or other  securities  underlying  Awards  already
                  made under the Plan;

         (c)      adjustments  in the Exercise  Price of  outstanding  Incentive
                  and/or Non-Statutory Stock Options.

No such  adjustments  may,  however,  materially  change  the value of  benefits
available to a Participant  under a previously  granted Award.  All Awards under
this Plan  shall be  binding  upon any  successors  or  assigns  of the  Holding
Company.  Notwithstanding  the above, in the event of an  extraordinary  capital
distribution,  any adjustment under this Section 13 shall be subject to required
approval by the Office of Thrift Supervision.

14.      TAXES.
         -----

         (a)      Whenever  under this Plan,  cash or shares of Common Stock are
to be  delivered  upon  exercise  or payment of an Award or any other event with
respect to rights and benefits  hereunder,  the  Committee  shall be entitled to
require as a condition  of  delivery  (i) that the  Participant  remit an amount
sufficient to satisfy all federal, state, and local withholding tax requirements
related thereto,  (ii) that the withholding of such sums come from  compensation
otherwise due to the  Participant  or from any shares of Common Stock due to the
Participant under this Plan or (iii) any combination of the foregoing; provided,
however,  that no amount  shall be withheld  from any cash  payment or shares of
Common Stock relating to an Award which was  transferred  by the  Participant in
accordance with this Plan. Furthermore, Participants may direct the Committee to
instruct  the Trustee to sell shares of Common  Stock to be  delivered  upon the
payment of an Award to satisfy tax obligations.

         (b)      If any disqualifying  disposition described in Section 7(k) is
made with respect to shares of Common Stock  acquired  under an Incentive  Stock
Option granted pursuant to this Plan, or any transfer  described in Section 6(c)
is made, or any election described in Section 15 is made, then the person making
such disqualifying disposition, transfer, or election shall remit to the Holding
Company or its  Affiliates an amount  sufficient to satisfy all federal,  state,
and local withholding  taxes thereby  incurred;  provided that, in lieu of or in
addition to the foregoing,  the Holding Company or its Affiliates shall have the
right to withhold such sums from compensation  otherwise due to the Participant,
or, except in the case of any transfer pursuant to Section 6(c), from any shares
of Common Stock due to the Participant under this Plan.

                                       10
<PAGE>
15.      NOTIFICATION UNDER SECTION 83(b).
         --------------------------------

         The Committee  may, on the Date of Grant or any later date,  prohibit a
Participant  from making the election  described below. If the Committee has not
prohibited  such  Participant  from making such  election,  and the  Participant
shall, in connection with the exercise of any Option,  or the grant of any Stock
Award,  make the  election  permitted  under  Section  83(b) of the  Code,  such
Participant shall notify the Committee of such election within 10 days of filing
notice of the election  with the Internal  Revenue  Service,  in addition to any
filing and  notification  required  pursuant  to  regulations  issued  under the
authority of Section 83(b) of the Code.

16.      AMENDMENT OF THE PLAN AND AWARDS.
         --------------------------------

         (a)      Except as provided in  paragraph  (c) of this  Section 16, the
Board of Directors may at any time,  and from time to time,  modify or amend the
Plan in any respect,  prospectively or retroactively;  provided,  however,  that
provisions  governing  grants of Incentive  Stock Options shall be submitted for
shareholder  approval to the extent  required by law,  regulation  or otherwise.
Failure to ratify or approve  amendments or modifications by shareholders  shall
be effective only as to the specific  amendment or  modification  requiring such
ratification  or  approval.  Other  provisions  of this Plan will remain in full
force and effect. No such  termination,  modification or amendment may adversely
affect  the rights of a  Participant  under an  outstanding  Award  without  the
written permission of such Participant.

         (b)      Except as provided in  paragraph  (c) of this  Section 16, the
Committee  may  amend  any  Award  Agreement,  prospectively  or  retroactively;
provided,  however,  that no such amendment shall adversely affect the rights of
any Participant  under an outstanding  Award without the written consent of such
Participant.

         (c)      In no event  shall  the Board of  Directors  amend the Plan or
shall the Committee  amend an Award  Agreement in any manner that has the effect
of:

                  (i)      Allowing  any Option to be granted  with an  Exercise
                           Price below the Fair Market Value of the Common Stock
                           on the Date of Grant.

                  (ii)     Allowing the Exercise Price of any Option  previously
                           granted  under the Plan to be reduced  subsequent  to
                           the Date of Award.

         (d)      Notwithstanding  anything in this Plan or any Award  Agreement
to the contrary,  if any Award or right under this Plan would, in the opinion of
the Holding  Company's  accountants,  cause a transaction  to be ineligible  for
pooling of  interest  accounting  that  would,  but for such Award or right,  be
eligible for such accounting treatment,  the Committee,  at its discretion,  may
modify,  adjust,  eliminate or  terminate  the Award or right so that pooling of
interest accounting is available.

17.      EFFECTIVE DATE OF PLAN.
         ----------------------

         The Plan shall become effective on April 8, 2000, but only if, prior to
such date, the Plan is approved by the Holding Company's shareholders.  The Plan
will be so  approved  if at an annual or special  meeting of  shareholders  held
prior to such date a quorum is  present  and the  majority  of the votes cast at
such  meeting by the  holders of the Common  Stock shall be cast in favor of its
approval.  If the Plan is not approved by  shareholders  in accordance  with the
regulations of the Internal Revenue Service, the Plan shall remain in full force
and effect,  and any  Incentive  Stock  Options  granted under the Plan shall be
deemed to be Non-Statutory Stock Options.

                                       11
<PAGE>
18.      TERMINATION OF THE PLAN.
         -----------------------

         The  right to grant  Awards  under  the Plan  will  terminate  upon the
earlier of: (i) ten (10) years after the Effective  Date; (ii) the issuance of a
number of shares of Common  Stock  pursuant  to the  exercise  of Options or the
distribution  of Stock  Awards is  equivalent  to the  maximum  number of shares
reserved under the Plan as set forth in Section 4 hereof. The Board of Directors
has the right to suspend or  terminate  the Plan at any time,  provided  that no
such  action  will,  without the consent of a  Participant,  adversely  affect a
Participant's vested rights under a previously granted Award.

19.      APPLICABLE LAW.
         --------------

         The Plan will be  administered in accordance with the laws of the State
of Indiana to the extent not pre-empted by applicable federal law.

20.      TREATMENT OF UNVESTED, UNEXERCISED, OR NON-EXERCISABLE AWARDS UPON A
         --------------------------------------------------------------------
         CHANGE IN CONTROL.
         ------------------

         In the event of a Change in Control  where the  Holding  Company or the
Bank is not the surviving entity,  the Board of Directors of the Holding Company
and/or the Bank, as applicable, shall require that the successor entity take one
of the following  actions with respect to all Awards held by Participants at the
date of the Change in Control:

         (a)      Assume  the  Awards  with the same  terms  and  conditions  as
granted to the Participant under this Plan; or

         (b)      Replace the Awards with comparable Awards, subject to the same
or more favorable  terms and conditions as the Award granted to the  Participant
under this Plan,  whereby the  Participant  will be granted  common stock or the
option to purchase common stock of the successor entity; or

         (c)      Replace  the  Awards  with  an   immediate   cash  payment  of
equivalent value.

                                       12