**Exhibit 10.4****IRWIN FINANCIAL CORPORATION****AMENDED AND RESTATED 2001 STOCK PLAN**
 

 
**TABLE OF CONTENTS**               Page 1.1 Establishment  1          1.2 Purpose  1          1.3 Effective Date  1          2.1 Definitions  1          2.2 Gender and Number  3          3.1 Eligibility and Participation  3          4.1 Administration  3          5.1 Aggregate Number  4          5.2 Individual Participant Limitations  4          5.3 Reuse  4          5.4 Adjustment in Capitalization  5          6.1 Duration of Plan  5          7.1 Grant of Options  5          7.2 Option Agreement  5          7.3 Option Price  5          7.4 Exercise of Options  5          7.5 Payment  6          7.6 Limitations on ISOs  7          7.7 Restrictions on Stock Transferability  8          7.8 Termination of Employment or Service  8            (a) Termination of Employment or Service Due to Death or Disability  8            (b) Termination of Employment or Service Due to Retirement  8            (c) Resignation or Termination Without Cause  9            (d) Termination for Cause  9          7.9 Effect of a Change in Control  9          7.10 Nontransferability of Options  9          8.1 Grant of Stock Appreciation Rights  10          8.2 Payment of SAR Amount  10          8.3 Form and Timing of Payment  10          8.4 Limit of Appreciation  11 
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               Page 8.5 Term of SAR  11          8.6 Termination of Employment or Service; Change in Control  11          8.7 Nontransferability of SARs  11          9.1 Grant of Restricted Stock  11          9.2 Transferability  11          9.3 Other Restrictions  12          9.4 Voting Rights  12          9.5 Dividends and Other Distributions  12          9.6 Termination of Employment or Service; Change in Control  12            (a) Termination of Employment or Service Due to Death or Disability  12            (b) Termination of Employment or Service for Reasons Otherthan Death or Disability  12            (c) Change in Control  12          9.7 Nontransferability of Restricted Stock  13          10.1 Grant of Phantom Stock Units  13          10.2 Value  13          10.3 Payment for Phantom Stock Units  13          10.4 Form and Timing of Payment  13          10.5 Termination of Employment or Service; Change in Control  14          10.6 Nontransferability  14          10.7 No Dividend Payments  14          10.8 Expiration  14          11.1 Beneficiary Designation  14          12.1 Employment or Service  14          12.2 Participation    14          13.1 In General  14          13.2 Definition  15          14.1 Amendment, Modification, and Termination of Plan  16          14.2 Interpretation  16          15.1 Tax Withholding  16          15.2 Share Withholding  16          16.1 Indemnification  17          17.1 Requirements of Law  17          17.2 Governing Law  17 
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**IRWIN FINANCIAL CORPORATION****AMENDED AND RESTATED 2001 STOCK PLAN****Section 1. Establishment, Purpose, and Effective Date of Plan**     1.1 *Establishment*. Irwin Financial Corporation, an Indiana corporation, hereby establishesthe Irwin Financial Corporation Amended and Restated 2001 Stock Plan (the “Plan”) for employees andnon-employee directors of the Company and its subsidiaries. The Plan permits the grant of stockoptions, stock appreciation rights, restricted stock and phantom stock units, with common stock orcash as possible payout mediums for payment under the Plan.     1.2 *Purpose*. The purpose of the Plan is to advance the interests of the Company and itsstockholders, by encouraging and providing for the acquisition of an equity interest in the successof the Company by employees of the Company and its subsidiaries and non-employee directors, byproviding additional incentives and motivation toward superior performance of the Company, and byenabling the Company to attract and retain the services of employees and non-employee directorsupon whose judgment, interest, and special effort the successful conduct of its operations islargely dependent.     1.3 *Effective Date*. The Plan shall become effective immediately upon its adoption by theBoard of Directors of the Company, subject to ratification by the stockholders of the Company.Awards may be granted hereunder on or after the effective date but shall in no event be exercisableor payable to a Participant prior to such stockholder approval; and, if such approval is notobtained within twelve (12) months after the effective date, such Awards shall be of no force andeffect.**Section 2. Definitions**     2.1 *Definitions*. Whenever used herein, the following terms shall have their respectivemeanings set forth below:          “Award” means any Option, Stock Appreciation Right, Restricted Stock, or Phantom Stock Unit,granted under this Plan.          “Board” means the Board of Directors of the Company.          “Cause” is defined in Section 14.2.          “Code” means the Internal Revenue Code of 1986, as amended.          “Change in Control” is defined in Section 13.2 herein.          “Committee” means the Compensation Committee of the Board or such other committee appointedfrom time to time by the Board to administer this Plan. The Committee shall consist of two or moremembers, each of whom shall qualify as a “non-employee director,”
 

 
as the term (or similar or successor term) is defined by Rule 16b-3, and as an “outsidedirector” within the meaning of Code Section 162(m) and regulations thereunder.          “Company” means Irwin Financial Corporation, a Indiana corporation.          “Disability” is defined in Section 14.2.          “Employee” means an employee (including officers and directors who are also employees) of theCompany or its subsidiaries, or any branch or division thereof.          “Fair Market Value” means the mean of the closing bid and ask prices of the Stock as reportedby the New York Stock Exchange on a particular date. In the event that there are no Stocktransactions on such date, the Fair Market Value shall be determined as of the immediatelypreceding date on which there were Stock transactions.          “Named Executive Officer” means a Participant who, as of the date of vesting and/or payout ofan Award, as applicable, is one of the group of covered employees, as defined in the regulationspromulgated under Code Section 162(m), or any successor statute.          “Non-Employee Director” means a director of the Company who is not, and for a period of atleast one year, has not been an Employee.          “Option” means the right to purchase Stock at a stated price for a specified period of time.For purposes of the Plan an Option may be either (i) an “Incentive Stock Option,” or “ISO” withinthe meaning of Section 422 of the Code, (ii) a “Nonstatutory (Nonqualified) Stock Option,” or“NSO,” or (iii) any other type of option encompassed by the Code.          “Participant” means any Non-Employee Director and any Employee designated by the Committee (orits delegate, if appropriate under Section 3.1) to participate in the Plan.          “Performance-Based Exception” means the exception for performance-based compensation from thetax deductibility limitations of Code Section 162(m).          “Period of Restriction” means the period during which the transfer of shares of RestrictedStock is restricted pursuant to Section 9 of the Plan.          “Phantom Stock Unit” is described under Section 10.          “Plan” means the Irwin Financial Corporation Amended and Restated 2001 Stock Plan as set forthherein and any amendments hereto.          “Restricted Stock” means Stock granted to a Participant pursuant to Section 9 of the Plan.          “Retirement” is defined in Section 14.2.
 

 
          “Rule 16b-3” means Rule 16b-3 or any successor or comparable rule or rules applicable toAwards granted under the Plan promulgated by the Securities and Exchange Commission under Section16(b) of the Securities Exchange Act of 1934, as amended.          “Stock” means the Common Stock, without par value, of the Company.          “Stock Appreciation Right” and “SAR” mean the right to receive a payment from the Companyequal to the excess of the Fair Market Value of a share of stock at the date of exercise over aspecified price fixed by the Committee, which shall not be less than 100% of the Fair Market Valueof the Stock on the date of grant. In the case of a Stock Appreciation Right which is granted inconjunction with an Option, the specified price shall be the Option exercise price.     2.2 *Gender and Number*. Except when otherwise indicated by the context, words in the masculinegender when used in the Plan shall include the feminine gender, the singular shall include theplural, and the plural shall include the singular.**Section 3. Eligibility and Participation**     3.1 *Eligibility and Participation*. Participants in the Plan shall be selected by theCommittee from among the Employees. Non-Employee Directors shall also be eligible to participatein the Plan. For purposes of Awards to individuals who are neither Named Executive Officers nordirectors of the Company, the Committee may delegate its authority to select Participants in thePlan, to select the type of Awards to be received by such Participants, and to allocateCommittee-approved block Awards, to such individuals or bodies as the Committee designates inwriting. If such delegation occurs, “Committee” as used herein shall mean such individual or body.**Section 4. Administration**     4.1 *Administration*. The Committee shall be responsible for the administration of the Plan.The Committee, by majority action thereof (whether taken during a meeting or by written consent),is authorized to interpret the Plan, to prescribe, amend, and rescind rules and regulationsrelating to the Plan, to provide for conditions and assurances deemed necessary or advisable toprotect the interests of the Company, and to make all other determinations necessary or advisablefor the administration of the Plan, but only to the extent not contrary to the express provisionsof the Plan; provided, however, the Committee shall not reprice or otherwise decrease the exerciseprice applicable to any outstanding Option, except in connection with an adjustment contemplated bySection 5.4. The Committee’s authorization to administer the Plan shall extend to developing andimplementing rules and regulations relating to sub-plans established for the purpose of qualifyingfor preferred tax treatment under foreign tax laws and accommodating the specific requirements oflocal laws and procedures, including but not limited to the adoption of rules and proceduresregarding the conversion of local currency, withholding procedures and handling of stockcertificates which vary with local requirements. Determinations, interpretations, or other actionsmade or taken by the Committee pursuant to the provisions of the Plan shall be final and bindingand conclusive for all purposes and upon all persons whomsoever.
 

 
To the extent deemed necessary or advisable for purposes of Rule 16b-3 or otherwise, the Boardmay act as the Committee hereunder.**Section 5. Stock Subject to Plan and Maximum Awards**     5.1 *Aggregate Number*. The total number of shares of Stock that may be issued pursuant toAwards under the Plan may not exceed 4,000,000 (of this total number, all such shares may be issuedwith respect to Incentive Stock Options). Such numbers of shares shall be subject to adjustmentupon occurrence of any of the events described in Section 5.4. The shares to be delivered underthe Plan may consist, in whole or in part, of authorized but unissued Stock or treasury Stock, notreserved for any other purpose. In addition, up to an aggregate of 2,000,000 SARs may be grantedunder the Plan.     5.2 *Individual Participant Limitations*. Unless and until the Committee determines that anAward to a Named Executive Officer shall not be designed to comply with the Performance-BasedException, the following rules shall apply to grants of such Awards under the Plan: (a) Subject to adjustment as provided in Section 5.4, the maximumaggregate number of shares of Stock (including Options, Restricted Stock SARs,and Phantom Stock Units to be paid out in shares) that may be granted underthis Plan in any calendar year pursuant to any Award held by any Participantshall be 300,000 shares. Such numbers of shares shall be subject to adjustmentupon occurrence of any of the events described in Section 5.4.  (b) The maximum aggregate cash payout (including SARs and PhantomStock Units paid out in cash) with respect to Awards granted under this Plan inany calendar year which may be made to any Participant shall be one milliondollars ($1,000,000.00).     5.3 *Reuse*. If, and to the extent: (a) An Option shall expire or terminate for any reason withouthaving been exercised in full (including, without limitation, cancellation andre-grant), or in the event that an Option is exercised or settled in a mannersuch that some or all of the shares of Stock related to the Option are notissued to the Participant (or beneficiary) including as the result of the useof shares for withholding taxes, the shares of Stock subject thereto which havenot become outstanding shall (unless the Plan shall have terminated) becomeavailable for issuance under the Plan; provided, however, that with respect toa share-for-share exercise, only the net shares issued shall be deemed to havebecome outstanding as a result thereof.  (b) Restricted Stock or Phantom Stock Units under the Plan areforfeited for any reason, or settled in cash in lieu of Stock or in a mannersuch that some or all of the shares of Stock related to the Award are notissued to
 

 
   the Participant (or beneficiary), such shares of Stock shall (unless thePlan shall have terminated) become available for issuance under the Plan.  (c) SARs expire or terminate for any reason without having beenearned in full, an equal number of SARs shall (unless the Plan shall haveterminated) become available for issuance under the Plan.     5.4 *Adjustment in Capitalization*. In the event of any change in the outstanding shares ofStock that occurs after ratification of the Plan by the stockholders of the Company by reason of aStock dividend or split, recapitalization, merger, consolidation, combination, separation(including a spin-off), exchange of shares, or other similar corporate change or distribution ofstock or property by the Company, the number and class of and/or price of shares of Stock subjectto each outstanding Award, the number of shares of Stock available for Awards and the number andclass of shares of Stock set forth in Sections 5.1 and 5.2, shall be adjusted appropriately by theCommittee, whose determination shall be conclusive; provided, however, that fractional shares shallbe rounded to the nearest whole share. In such event, the Committee also shall have discretion tomake appropriate adjustments in the number and type of shares subject to Awards then outstandingunder the Plan pursuant to the terms of such grants or otherwise.**Section 6. Duration of Plan**     6.1 *Duration of Plan*. The Plan shall remain in effect until, and no Award may be granted onor after, April 25, 2011, subject to the Board’s right to earlier terminate the Plan pursuant toSection 14 hereof.**Section 7. Stock Options**     7.1 *Grant of Options*. Subject to the provisions of Section 5 and 6, Options may be granted toParticipants at any time and from time to time as shall be determined by the Committee. TheCommittee shall have complete discretion in determining the number of Options granted to eachParticipant. The Committee may grant any type of Option to purchase Stock that is permitted by lawat the time of grant.     7.2 *Option Agreement*. Each Option shall be evidenced by an option agreement that shallspecify the type of Option granted, the Option price, the duration of the Option, the number ofshares of Stock to which the Option pertains, the vesting schedule for the Options, and such otherprovisions as the Committee shall determine.     7.3 *Option Price*. No Option granted pursuant to the Plan shall have an Option price that isless than the Fair Market Value of the Stock on the date the Option is granted.     7.4 *Exercise of Options*. Options awarded under the Plan shall be exercisable at such timesand be subject to such restrictions and conditions as the Committee shall approve, either at thetime of grant of such Options or pursuant to a general determination, and which need not be thesame for all Participants. Each Option which is intended to qualify as an Incentive Stock Optionpursuant to Section 422 of the Code, and each Option which is intended to qualify as
 

 
another type of ISO which may subsequently be authorized by law, shall comply with theapplicable provisions of the Code pertaining to such Options.     7.5 *Payment*. Options shall be exercised by the delivery of a written notice of exercise tothe Company, setting forth the number of shares of Stock with respect to which the Option is to beexercised, accompanied by full payment for the Stock. The Option price upon exercise of any Optionshall be payable to the Company in full, as provided in the option agreement, either: (a) in cash, check or wire transfer, denominated in U.S. Dollarsexcept with the consent of the Committee or as specified by the Committee withrespect to foreign employees or foreign sub-plans;  (b) by tendering previously-acquired Stock (as determined by theCommittee) having an aggregate Fair Market Value at the time of exercise equalto the total Option price,  (c) if the Committee shall authorize in its sole discretion, bypayment of the purchase price in installments or with other borrowed funds;provided, however, that the provisions of each installment purchase agreement:(i) shall provide that the purchaser, at the purchaser’s option, may pay any orall such installments at one time, (ii) shall comply with all applicable creditregulations, if any, then in effect and issued or enacted by governmentalauthority having jurisdiction, including Regulation U of the Board of Governorsof the Federal Reserve System if such Regulation is then in effect, (iii) shallbe established by the Committee and shall include a specified rate of interestpayable on the unpaid balance, and (iv) shall require that the certificate forShares purchased pursuant to installment arrangement be pledged to the Company,    The certificates for stock purchased pursuant to an installment purchaseagreement will be delivered to the purchaser, who shall take title to suchStock, and shall be immediately deposited by the purchaser, together with aproperly executed stock power, with the Secretary of the Company to be heldby the Company as security for the payment of the installments of thepurchase price, including interest. The purchaser shall be entitled to allvoting rights with respect thereto and all cash dividends paid thereon. Inthe event of the payment by the Company of a stock dividend on or thedeclaration by the Company of a stock split with respect to any of its Stockheld as security pursuant to an installment purchase agreement hereunder,the pledge under such agreement shall extend to the Stock issued in paymentof such stock dividend or on account of such stock split. The purchasershall deliver to the Company the certificates representing the dividend orsplit Stock upon receipt thereof, together with a properly executed stockpower. In the event that the Stock held as security pursuant to aninstallment purchase agreement shall be changed or reclassified as a resultof any charter amendment, recapitalization,
 

 
   reorganization, merger, consolidation, sale of assets or similartransactions, the changed or reclassified Stock or other assets or bothreceived as a result of such transaction shall be substituted for the Stockpledged under such agreement; and the purchaser shall promptly deliver tothe Company any certificates issued to represent the Stock so changed orreclassified and any such other assets, together with a properly executedstock power. If rights to subscribe for or purchase Stock or othersecurities shall be issued to holders of Stock held as security pursuant toan installment purchase agreement, such rights shall belong to the purchaserfree from pledge. Upon completion of payment for such Stock, includinginterest to the date of payment, and subject to any requirements necessaryto comply with Regulation U or other applicable credit regulations, thepurchaser shall be entitled to the return from the Company of thecertificates so pledged,  (d) by any other means which the Committee determines to beconsistent with the Plan’s purpose and applicable law,  (e) by having the notice of exercise direct that the certificate orcertificates for such Shares for which the option is exercised be delivered toa licensed broker acceptable to the Company as the agent for the individualexercising the option and, at the time such certificate or certificates aredelivered, the broker tenders to the Company cash or cash equivalentsacceptable to the Company equal to the purchase price for such Shares purchasedpursuant to the exercise of the option plus the amount (if any) of federal andother taxes which the Company may, in its sole judgment, be required towithhold with respect to the exercise of the option, or  (f) by a combination of (a), (b), (c), (d) and (e).The exercise of an Option shall cancel any SAR which was specifically granted in tandem with suchOption to the extent of the number of shares as to which the Option is exercised. As soon aspracticable after receipt of each notice and full payment, the Company shall deliver to theParticipant a certificate or certificates representing acquired shares of Stock.     7.6 *Limitations on ISOs*. Notwithstanding anything in the Plan to the contrary, to the extentrequired from time to time by the Code, the following additional provisions shall apply to thegrant of Options which are intended to qualify as Incentive Stock Options (as such term is definedin Section 422 of the Code): (a) The aggregate Fair Market Value (determined as of the date theOption is granted) of the shares of Common Stock with respect to whichIncentive Stock Options are exercisable for the first time by any Participantduring any calendar year (under all plans of the Company) shall not exceed$100,000 or such other amount as may subsequently be specified by the Code;provided that, to the extent that such limitation is exceeded, any
 

 
   excess Options (as determined under the Code) shall be deemed to beNonstatutory (Nonqualified) Stock Options. (b) Any Incentive Stock Option authorized under the Plan shallcontain such other provisions as the Committee shall deem advisable, but shallin all events be consistent with and contain or be deemed to contain allprovisions required in order to qualify the Options as Incentive Stock Options,including, but not limited to, provisions applicable to Incentive Stock Optionsgranted to a 10% shareholder of the Company within the meaning of Code Section422(b)(6).  (c) All Incentive Stock Options must be granted within ten yearsfrom the date on which this Plan was adopted by the Board of Directors.  (d) Unless exercised, terminated, or canceled sooner, all IncentiveStock Options shall expire no later than ten years after the date of grant(five years in the case of an ISO granted to a 10% shareholder).     7.7 *Restrictions on Stock Transferability*. The Committee shall impose such restrictions onany shares of Stock acquired pursuant to the exercise of an Option under the Plan as it may deemadvisable, including, without limitation, restrictions under the applicable federal securities law,under the requirements of any stock exchange upon which such shares of Stock are then listed andunder any blue sky or state securities laws applicable to such shares.     7.8 *Termination of Employment or Service*. Unless otherwise provided in the option agreement,subsections (a) through (d) shall apply. (a) Termination of Employment or Service Due to Death orDisability. In the event a Participant’s employment or service as aNon-Employee Director is terminated by reason of death or disability, anyoutstanding Options whether or not then exercisable, may be exercised withinthree (3) years after such date of termination of employment or service. In nocase shall the period for exercise extend beyond the expiration date of suchoption grant.  (b) Termination of Employment or Service Due to Retirement. In theevent that a Participant’s employment or service as a Non-Employee Director isterminated due to retirement, the Options theretofore granted to suchParticipant may be exercised to the extent that such Participant was entitledto exercise the Options at the date of such termination, but only within aperiod of three (3) years beginning on the day following the date of suchtermination, and provided further that any Incentive Stock Options may beexercised only within a period of three (3) months beginning on the dayfollowing the date of such termination. In no case shall the period forexercise extend beyond the expiration date of such Option grant. So long as aParticipant shall continue to serve as a Non-Employee Director or continue tobe an employee of the Company, the Options granted to the
 

 
   Participant shall not be affected by any change of duties or position. Achange of employment from the Company to a subsidiary, from a subsidiary tothe Company, from one subsidiary to another, or any combination thereof,shall not be considered to be a termination of employment for purposes ofthis Plan.  (c) Resignation or Termination Without Cause. In the event that aParticipant’s employment with the Company or its subsidiaries or the service ofa Non-Employee Director is terminated due to resignation or termination withoutcause (other than in circumstances that constitute a retirement), the optionstheretofore granted to such Participant may be exercised to the extent thatsuch Participant was entitled to exercise the options at the date of suchresignation, but only within a period of three (3) months beginning on the dayfollowing the date of such termination. In no case shall the period forexercise extend beyond the expiration date of such option.  (d) Termination for Cause. Notwithstanding anything herein to thecontrary, all outstanding options shall immediately terminate without furtheraction on the part of the Company in the event of the termination of aParticipant’s employment or service with the Company or its subsidiaries forCause.     7.9 *Effect of a Change in Control*. Unless otherwise provided in the Stock Option agreement,the following shall apply in the event of a Change of Control. Upon the occurrence of a Change ofControl, the Company shall provide written notice thereof (the “Change in Control Notice”) to theParticipants. The Company shall have the right, but not the obligation, to terminate alloutstanding options as of the 30th day immediately following the date of the sending of the Changein Control Notice by including a statement to such effect in the Change in Control Notice. Upondelivery of the Change in Control Notice and regardless of whether the Company elects to terminatethe outstanding options, the Participants shall have the right to immediately exercise alloutstanding options (whether or not immediately exercisable, notwithstanding the Change in Control)in full during the 30-day period notwithstanding the other terms and conditions otherwise set forthin the Plan or in any certificate or agreement representing such option.     7.10 *Nontransferability of Options*. Except as provided below, no Option granted under thePlan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, otherwisethan by will or by the laws of descent and distribution. Further, all Options granted to aParticipant under the Plan shall be exercisable during his lifetime only by such Participant.Notwithstanding the foregoing, the Committee may, in its discretion, authorize all or a portion ofthe Options (other than Incentive Stock Options) granted to a Participant to be on terms whichpermit transfer by such Participant to: (a) the spouse, children or grandchildren of the Participant(“Immediate Family Members”);
 

 
 (b) a trust or trusts for the exclusive benefit of such ImmediateFamily Members, or; (c) a partnership in which such Immediate Family Members are theonly partners, provided that: (i) there may be no consideration for any suchtransfer;  (ii) the Award agreement pursuant to which suchOptions are granted expressly provides for transferability in a mannerconsistent with this Section 7.10; and  (iii) subsequent transfers of transferred Optionsshall be prohibited except transfers back to the Participant or thosein accordance with Section 11.Following transfer, any such Options shall continue to be subject to the same terms and conditionsas were applicable immediately prior to the transfer, provided that for purposes of Section 11hereof, the term “Participant” shall be deemed to refer to the transferee. The provisions ofSection 7 relating to the period of exercisability and expiration of the Option shall continue tobe applied with respect to the original Participant, and the Option shall be exercisable by thetransferee only to the extent, and for the periods, set forth in said Section 7.     7.11 *Compliance with Code Section 409A.*No Option shall provide for deferral of compensationthat does not comply with Section 409A of the Code, unless the Board, at the time of grant,specifically provides that the Option is not intended to comply with Section 409A of the Code.**Section 8. Stock Appreciation Rights**     8.1 *Grant of Stock Appreciation Rights*. Subject to the provisions of Sections 5 and 6, StockAppreciation Rights (“SARs”) may be granted to Participants at any time and from time to time asshall be determined by the Committee. The Committee shall have complete discretion in determiningthe number of SARs granted to each Participant. Each SAR award shall be evidenced by an Awardagreement setting forth the number of shares of Stock to which the SAR pertains, the vestingschedule for the SARs, and such other provisions as the Committee shall determine.     8.2 *Payment of SAR Amount*. Upon exercise of the SAR, the Participant shall be entitled toreceive payment of an amount (subject to Section 8.4 below) determined by multiplying: (a) The difference between the Fair Market Value of a share ofStock at the date of exercise over the price fixed by the Committee at the dateof grant, by  (b) The number of shares with respect to which the StockAppreciation Right is exercised.
 

 
     8.3 *Form and Timing of Payment*. At the discretion of the Committee, payment to theParticipant of the SAR amount described in Section 8.2 may be made in cash or Stock, or in acombination thereof.     8.4 *Limit of Appreciation*. At the time of grant, the Committee may establish in its solediscretion, a maximum amount per share which will be payable upon exercise of an SAR.     8.5 *Term of SAR*. The term of an SAR granted under the Plan shall not exceed ten years.     8.6 *Termination of Employment or Service; Change in Control*. Unless otherwise provided in theAward agreement, in the event of (i) termination of the employment or service of a Participant, or(ii) upon a Change in Control, any SARs outstanding shall be treated in the same manner asspecified for Options (excluding Incentive Stock Options) under Sections 7.8 and 7.9 respectively.     8.7 *Nontransferability of SARs*. No SAR granted under the Plan may be sold, transferred,pledged, assigned, or otherwise alienated or hypothecated, otherwise than by will or by the laws ofdescent and distribution. Further, all SARs granted to a Participant under the Plan shall beexercisable during his lifetime only by such Participant.**Section 9. Restricted Stock**     9.1 *Grant of Restricted Stock*. Subject to the provisions of Sections 5 and 6, the Committee,at any time and from time to time, may grant shares of Restricted Stock under the Plan to suchParticipants and in such amounts as it shall determine. Each grant of Restricted Stock shall beevidenced by an Award agreement which shall specify the number of shares of stock granted, theschedule for lapse of the restrictions, and such other provisions as the Committee shall determine.If such Award agreement specifies a purchase price to be paid by Participant for the RestrictedStock, such price may be paid in any of the forms described under Sections 7.5(a)-(f) above.     The Committee may at any time and from time to time, establish performance criteria withrespect to an Award of Restricted Stock. The performance criteria or standards shall be determinedby the Committee in writing and may be absolute in their terms or measured against or inrelationship to other companies comparably, similarly or otherwise situated and may be based on oradjusted for any other objective goals, events, or occurrences established by the Committee,provided that such criteria or standards relate to one or more of the following: earnings,earnings growth, revenues, expenses, stock price, market share, charge-offs, loan loss reserves,reductions in non-performing assets, return on assets, return on equity, or assets, investment,regulatory compliance, satisfactory internal or external audits, improvement of financial ratings,achievement of balance sheet or income statement objectives, extraordinary charges, losses fromdiscontinued operations, restatements and accounting changes and other unplanned special chargessuch as restructuring expenses, acquisition expenses including goodwill, unplanned stock offeringsand strategic loan loss provisions. Such performance standards may be particular to a line ofbusiness, subsidiary or other unit or may be based on the performance of the Company generally.
 

 
     9.2 *Transferability*. Except as provided in Sections 9.6 and 9.7 hereof, the shares ofRestricted Stock granted hereunder may not be sold, transferred, pledged, assigned, or otherwisealienated or hypothecated for such period of time (the “Period of Restriction”) as shall bedetermined by the Committee and shall be specified in the Restricted Stock Award agreement, or uponearlier satisfaction of other conditions, as specified by the Committee in its sole discretion andset forth in the Restricted Stock Award agreement.     9.3 *Other Restrictions*. The Committee shall impose such other restrictions on any shares ofRestricted Stock granted pursuant to the Plan as it may deem advisable including, withoutlimitation, restrictions under applicable federal or state securities laws, and may legend thecertificates representing Restricted Stock to give appropriate notice of such restrictions.     9.4 *Voting Rights*. Participants holding shares of Restricted Stock granted hereunder mayexercise full voting rights with respect to those shares during the Period of Restriction.     9.5 *Dividends and Other Distributions*. During the Period of Restriction, Participants holdingshares of Restricted Stock granted hereunder shall be entitled to receive all dividends and otherdistributions paid with respect to those shares while they are so held. If any dividends ordistributions are paid in shares of Stock pursuant to Section 5.4, the shares shall be subject tothe same restrictions on transferability as the shares of Restricted Stock with respect to whichthey were paid.     9.6 *Termination of Employment or Service; Change in Control*. Unless otherwise provided in theAward agreement, the following shall apply: (a) Termination of Employment or Service Due to Death orDisability. In the event a Participant’s employment or service as aNon-Employee Director is terminated due to death or disability, the Period ofRestriction applicable to the Restricted Stock pursuant to Subsection 9.2hereof shall automatically terminate and, except as otherwise provided inSubsection 9.3, the shares of Restricted Stock shall thereby be free ofrestrictions and freely transferable.  (b) Termination of Employment or Service for Reasons Other thanDeath or Disability. In the event that a Participant’s employment or serviceas a Non-Employee Director is terminated for any reason other than death ordisability during the Period of Restriction, then any shares of RestrictedStock still subject to restrictions at the date of such terminationautomatically shall be forfeited and returned to the Company; provided,however, that, in the event of retirement or an involuntary termination of theemployment of a Participant by the Company other than for cause, the Committeein its sole discretion may waive the automatic forfeiture of any or all suchshares and/or may add such new restrictions to such shares of Restricted Stockas it deems appropriate.  (c) Change in Control. Unless otherwise provided in the Awardagreement, upon a Change in Control, the Period of Restriction applicable tothe
 

 
   Restricted Stock pursuant to Subsection 9.2 hereof shall automaticallyterminate and, except as otherwise provided in Subsection 9.3, the shares ofRestricted Stock shall thereby be free of restrictions and freely transferable.     9.7 *Nontransferability of Restricted Stock*. No shares of Restricted Stock granted under thePlan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, otherwisethan by will or by the laws of descent and distribution until the termination of the applicablePeriod of Restriction. All rights with respect to Restricted Stock granted to a Participant underthe Plan shall be exercisable during his lifetime only by such Participant.**Section 10. Phantom Stock Units**     10.1 *Grant of Phantom Stock Units*. Subject to the provisions of Sections 5 and 6, PhantomStock Units may be granted to Participants at any time and from time to time as shall be determinedby the Committee. Each grant of Phantom Stock Units shall be evidenced by an Award agreementsetting forth the number of Phantom Stock Units, the applicable vesting schedule and such otherprovisions as the Committee shall determine.     The Committee may at any time and from time to time, establish performance criteria withrespect to an Award of Phantom Stock Units. The performance criteria or standards shall bedetermined by the Committee in writing and may be absolute in their terms or measured against or inrelationship to other companies comparably, similarly or otherwise situated and may be based on oradjusted for any other objective goals, events, or occurrences established by the Committee,provided that such criteria or standards relate to one or more of the following: earnings,earnings growth, revenues, expenses, stock price, market share, charge-offs, loan loss reserves,reductions in non-performing assets, return on assets, return on equity, or assets, investment,regulatory compliance, satisfactory internal or external audits, improvement of financial ratings,achievement of balance sheet or income statement objectives, extraordinary charges, losses fromdiscontinued operations, restatements and accounting changes and other unplanned special chargessuch as restructuring expenses, acquisition expenses including goodwill, unplanned stock offeringsand strategic loan loss provisions. Such performance standards may be particular to a line ofbusiness, subsidiary or other unit or may be based on the performance of the Company generally.     10.2 *Value*. Each Phantom Stock Unit shall represent one share of Stock.     10.3 *Payment for Phantom Stock Units*. After satisfaction of the vesting schedule specified inthe Award agreement, the holder of a Phantom Stock Unit shall be entitled to receive thethen-current Fair Market Value of a share of Stock multiplied by the number of Phantom Stock Unitshe chooses to exercise, less the exercise price to be paid by Participant (if any) as specified inthe Award agreement. If such Award agreement specifies an exercise price to be paid by Participantfor the Phantom Stock Units, such price may be paid in any of the forms described under Section7.5(a)-(f) above.
 

 
     10.4 *Form and Timing of Payment*. Payment to the Participant as described in Section 10.3above may be made in cash, Stock, or a combination thereof as determined by the Committee. Paymentmay be made in a lump sum or installments as prescribed by the Committee. If any payment is to bemade on a deferred basis, the Committee may provide for the payment of dividend equivalents orinterest during the deferral period.     10.5 *Termination of Employment or Service; Change in Control*. Unless otherwise provided inthe Award agreement, in the event of (i) termination of the employment or service of a Participant,or (ii) upon a Change in Control, any Phantom Stock Units outstanding shall be treated in the samemanner as specified for Options (excluding Incentive Stock Options) under Sections 7.8 and 7.9respectively.     10.6 *Nontransferability*. No Phantom Stock Units granted under the Plan may be sold,transferred, pledged, assigned, or otherwise alienated or hypothecated, otherwise than by will orby the laws of descent and distribution. All rights with respect to Phantom Stock Units granted toa Participant under the Plan shall be exercisable during his lifetime only by such Participant.     10.7 *No Dividend Payments*. A Participant granted Phantom Stock Units shall not be creditedwith any dividends which would be received with respect to an equivalent number of shares of Stock.     10.8 *Expiration*. A Participant’s Phantom Stock Units shall in all events expire on the tenthanniversary of the date on which they were awarded.**Section 11. Beneficiary Designation**     11.1 *Beneficiary Designation*. Each Participant under the Plan may name, from time to time,any beneficiary or beneficiaries (who may be named contingently or successively) to whom anybenefit under the Plan is to be paid in case of his death before he receives any or all of suchbenefit. Each designation will revoke all prior designations by the same Participant, shall be ina form provided by the Company, and will be effective only when filed by the Participant in writingwith the Committee during his lifetime. In the absence of any such designation, benefits remainingunpaid at the Participant’s death shall be paid to his estate.**Section 12. Rights of Employees and Non-Employee Directors**     12.1 *Employment or Service*. Nothing in the Plan shall interfere with or limit in any way theright of the Company to terminate any Participant’s employment or service as a Non-EmployeeDirector at any time, nor confer upon any Participant any right to continue in the employ of theCompany.     12.2 *Participation*. No Employee or Non-Employee Director shall have a right to be selected asa Participant, or, having been so selected, to be selected again as a Participant.**Section 13. Change in Control**     13.1 *In General*. Unless otherwise provided in an Award agreement, in the event of a Change inControl of the Company as defined below, all Awards under the Plan shall vest 100%,
 

 
whereupon allOptions, SARs and Phantom Stock Units shall become exercisable in full and the restrictionsapplicable to any Restricted Stock shall terminate.     13.2 *Definition*. Unless otherwise provided in an Award agreement, a “Change in Control” shallmean the occurrence of any of the following events: (a) Any “person” (as such term is used in Sections 13(d) and 14(d)of the Securities Exchange Act of 1934, as amended), other than (i) a trusteeor other fiduciary holding securities under an employee benefit plan of theCompany or any of its subsidiaries, or (ii) a Corporation owned directly orindirectly by the stockholders of the Company in substantially the sameproportions as their ownership of stock of the Company, is or becomes the“beneficial owner” (as defined in Rule 13d-3 under said Act), directly orindirectly, of securities of the Company representing 50% or more of the totalvoting power of the then outstanding shares of capital stock of the Companyentitled to vote generally in the election of directors (the “Voting Stock”),provided, however, that the following shall not constitute a change in control:(1) such person becomes a beneficial owner of 50% or more of the Voting Stockas the result of an acquisition of such Voting Stock directly from the Company,or (2) such person becomes a beneficial owner of 30% or more of the VotingStock as a result of the decrease in the number of outstanding shares of VotingStock caused by the repurchase of shares by the Company; provided, further,that in the event a person described in clause (1) or (2) shall thereafterincrease (other than in circumstances described in clause (1) or (2))beneficial ownership of stock representing more than 1% of the Voting Stock,such person shall be deemed to become a beneficial owner of 30% or more of theVoting Stock for purposes of this paragraph (a), provided such person continuesto beneficially own 30% or more of the Voting Stock after such subsequentincrease in beneficial ownership, or  (b) During any period of two consecutive years, individuals (the“Incumbent Board”), who at the beginning of such period constitute the board ofdirectors of the Company, and any new director, whose election by the board ofdirectors of the Company or nomination for election by the Company’sstockholders was approved by a vote of at least two-thirds (2/3) of thedirectors then still in office who either were directors at the beginning ofthe period or whose election or nomination for election was previously soapproved, cease for any reason to constitute a majority thereof, or  (c) The Company shall become a party to an agreement of areorganization, merger or consolidation or the sale or other disposition of allorsubstantially all of the assets of the Company (a “Business Combination”),in each case, unless (1) all or substantially all of the individuals andentities who were the beneficial owners, respectively, of the Voting Stockimmediately prior to such Business Combination beneficially own,
 

 
   directly orindirectly, more than 50% of the total voting power represented by thevoting securities entitled to vote generally in the election of directors ofthe corporation resulting from the Business Combination (including, withoutlimitation, a corporation which as a result of the Business Combination ownsthe Company’s or all or substantially all of the Company’s assets eitherdirectly or through one or more subsidiaries) in substantially the sameproportions as their ownership, immediately prior to the BusinessCombination of the Voting Stock of the Company, and (2) at least a majorityof the members of the board of directors of the corporation resulting fromthe Business Combination were members of the Incumbent Board at the time ofthe execution of the initial agreement, or action of the Incumbent Board,providing for such Business Combination, or (d) the stockholders of the Company approve a plan of completeliquidation or dissolution of the Company.The Committee has final authority to construe and interpret the provisions of the foregoingparagraphs (a), (b), (c) and (d) and to determine the exact date on which a change in control hasbeen deemed to have occurred thereunder.**Section 14. Interpretation, Amendment, Modification, and Termination of Plan**     14.1 *Amendment, Modification, and Termination of Plan*. The Board at any time may terminate,and from time to time may amend, modify or suspend the Plan in whole or part subject to anyrequirement of stockholder approval imposed by applicable law, rule or regulation. No amendment,modification, or termination of the Plan shall in any manner adversely affect any Award theretoforegranted under the Plan, without the consent of the Participant.     14.2 *Interpretation*. Whether a Participant’s employment or service as a Non-Employee Directoris terminated due to “retirement,” “disability,” “resignation” or “for cause” shall be determinedpursuant to the Award agreement by the Committee in its sole discretion, which determination shallbe final and conclusive. Whether an authorized leave of absence, or absence on military orgovernmental service, or for any other reason, shall constitute a termination of employment orservice for purposes of this Plan shall be determined by the Committee in its sole discretion,which determination shall be final and conclusive. The construction, interpretation and validityof the Plan and any Award hereunder shall be determined in accordance with and governed by the lawsof the State of Indiana applicable to contracts executed and performed in such state without givingeffect to conflicts of laws principles.**Section 15. Tax Withholding**     15.1 *Tax Withholding*. The Company shall have the power and the right to deduct or withhold,or require a Participant to remit to the Company, an amount sufficient to satisfy
 

 
federal, state,and local taxes, domestic or foreign, required by law or regulation to be withheld with respect toany taxable event arising as a result of the Plan.     15.2 *Share Withholding*. With respect to tax withholding required upon the exercise of Optionsor Phantom Stock Units, upon the lapse of restrictions on Restricted Stock, or upon any othertaxable event arising as a result of Awards granted hereunder, Participants may elect to satisfythe payroll tax withholding requirement, in whole or in part, by having the Company withhold sharesof Stock having a Fair Market Value on the date the tax is to be determined equal to the minimumstatutory total tax withholding which would be imposed on the transaction (or to such part of thetax so long as the balance above the minimum required withholding is paid by the Participant incash). All such elections shall be irrevocable, made in writing, signed by the Participant, andshall be subject to any restrictions or limitations that the Committee, in its sole discretion,deems appropriate.**Section 16. Indemnification**     16.1 *Indemnification*. Each person who is or shall have been a member of the Committee or ofthe Board, or to whom a delegation has been made pursuant to Section 3.1 hereof, shall beindemnified and held harmless by the Company against and from any loss, cost, liability, or expensethat may be imposed upon or reasonably incurred by him in connection with or resulting from anyclaim, action, suit, or proceeding to which he may be a party or in which he may be involved byreason of any action taken or failure to act under the Plan and against and from any and allamounts paid by him in settlement thereof, with the Company’s approval, or paid by him insatisfaction of any judgment in any such action, suit, or proceeding against him, provided he shallgive the Company an opportunity, at its own expense, to handle and defend the same before heundertakes to handle and defend it on his own behalf. The foregoing right of indemnification shallnot be exclusive of any other rights of indemnification to which such persons may be entitled underthe Company’s Certificate of Incorporation or Bylaws, as a matter of law, or otherwise, or anypower that the Company may have to indemnify them or hold them harmless.**Section 17. Requirements of Law**     17.1 *Requirements of Law*. The granting of Awards and the issuance of shares of Stock upon theexercise of an Option shall be subject to all applicable laws, rules, and regulations, and to suchapprovals by any governmental agencies or national securities exchanges as may be required,including without limitation (i) for residents of the United States, federal and state securitieslaws, (ii) for residents of Canada and other jurisdictions, the securities laws of Canada and otherjurisdictions, and (iii) for the Company, the listing maintenance requirements of the New YorkStock Exchange, or other exchanges or quotation markets.     17.2 *Governing Law*. The Plan, and all agreements hereunder, shall be construed in accordancewith and governed by the laws of the State of Indiana. With respect toany dispute arising out of this Plan, an Award or alleged breaches of this Plan, an Award orboth, a Participant, by accepting an Award, irrevocably consent, to the maximum extent permitted bylaw, to the jurisdiction and venue of the Federal Courts in Indiana if they have subject matter
 

 
jurisdiction, and otherwise to the jurisdiction and venue of the courts of the State of Indiana,and the Employee shall not be entitled to a trial by jury.**Section 18 Provisions for Foreign Participants**     The Committee may make Awards to Participants who are foreign nationals, who are employedoutside of the United States of America or both (collectively, “Foreign Participants”) on terms andconditions consistent with the Plan’s purpose but different from the provisions specified hereinwithout amending the Plan as may be necessary, desirable or appropriate, as determined in its solediscretion. Subject to any requirement of stockholder approval imposed by applicable law, rule orregulation, the Committee may modify previously granted Awards granted to Foreign Participants,establish sub-plans or procedures under the Plan or both to reflect special terms to recognizedifferences in laws, rules, regulations or customs of such foreign jurisdictions with respect totax, securities, currency, employee benefit or other matters.
 

 
**EXHIBIT TO THE IRWIN FINANCIAL CORPORATION****AMENDED AND RESTATED 2001 STOCK PLAN****SUB-PLAN FOR BENEFICIARIES RESIDING IN CANADA**The purpose of this exhibit to the Plan is to set forth the terms and conditions defining therights and obligations of both the Company and Participants who are considered Canadian taxresidents at any time and who may benefit from time to time from the Options granted by the Companyin compliance with the applicable Canadian legal and tax provisions and the general terms andconditions of the Plan.Article I PurposeThe Committee imposes the restrictions set forth in this sub-plan to Canadian tax residents for thepurpose of allowing affected Participants to be entitled to claim a stock option deduction pursuantto paragraph 110(1)(d) of the Canadian Income Tax Act (the “Act”) and applicable regulations. Thisexhibit shall be interpreted in all events consistent with this purpose.Article II. General Restriction for Paragraph 110(1)(d) Deduction(a) There shall be no limit on a Participant’s right to participate in dividends or in the assetsdistributed upon any liquidation of the Company with respect to Stock issued upon exercise of anOption.(b) Stock received on exercise of an Option cannot be converted into any other security (other thaninto another security of the Company or of another corporation with which it does not deal at arm’slength) that is, or would be, a “prescribed share” (as defined under the Act) as of the date ofconversion.(c) An Employee cannot at that time or any time thereafter require the Company to redeem, acquire,or cancel Stock received on exercise of an Option (except pursuant to a conversion permitted asdescribed in paragraph (b) above).(d) The Company shall not have the right to redeem, acquire or cancel Stock received on exercise ofan Option except at Fair Market Value.(e) The Company shall not be obligated to reduce the paid-up capital in respect of any Stockreceived on exercise of an Option (except where the reduction is required pursuant to a conversionpermitted as described in paragraph (b) above).Article III. Available Methods to Pay Option Exercise PriceA Participant subject to this sub-plan shall not tender shares of Stock acquired on exercise of anOption to exercise another option; provided, however, that nothing in this sub-plan shall prohibitany such Participant from exercising an Option by attesting that he or she owns shares of Stock
 

 
that have been held for more than six months having a total Fair Market Value that is at leastequal to its exercise price (as determined by the Committee on the date of exercise) and receivingnew shares of Stock with a total Fair Market Value equal to the difference between the value of theStock and the exercise price for the portion of the Option that is then being exercised by suchParticipant.Article IV Available Methods to Pay for Applicable TaxesA Participant subject to this sub-plan shall not tender shares of Stock acquired on exercise of anOption to satisfy his or her taxes as required by law to be withheld with respect to the exerciseof an Option; provided however, that nothing herein shall prohibit any such Participant fromattesting that he or she owns shares of Stock that have been held for at least six months with atotal Fair Market Value that is at least equal to such Participant’s applicable taxes as requiredby law to be withheld with respect to any such Award.Article V Effective DateThis Exhibit shall apply to all Options awarded to Participants who are considered Canadian taxresidents at any time on or after the Effective Date (as defined in the Plan).
 

 
**IRWIN FINANCIAL CORPORATION**