EXHIBIT 10(8)
SHARE PLEDGE AGREEMENT
between
TRUST UNDER
THIRD CENTURY BANCORP
STOCK OWNERSHIP PLAN AND TRUST AGREEMENT
and
THIRD CENTURY BANCORP
Dated: June 29, 2004
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SHARE PLEDGE AGREEMENT
THIS SHARE
PLEDGE AGREEMENT (this "Agreement" or "Share Pledge
Agreement"),
dated as of June 29, 2004, between the
Trust (the "Trust")
established pursuant
to the provisions of the THIRD CENTURY
BANCORP EMPLOYEE STOCK OWNERSHIP PLAN AND
TRUST AGREEMENT (EFFECTIVE AS OF JUNE 1,
2004) (the "Plan") by HOMEFEDERAL BANK,
as Trustee ("Trustee"), and Third Century Bancorp, an
Indiana corporation (the
"Company").
WITNESSETH:
WHEREAS,
contemporaneously herewith, the Trust and the Company have
entered
into that certain Exempt Loan and Share Purchase Agreement (the "Loan
Agreement"; definitions of terms appearing in which have the same meanings
herein, unless a clear contrary intention appears), dated June ___, 2004,
pursuant to which the Company has agreed to
lend to the Trust, and the Trust has
agreed to borrow from the Company,
the Trust Loan,
and the Trust,
to evidence
its indebtedness to the Company with
respect to the Trust Loan, has executed and
delivered the Trust Note to the Company;
and
WHEREAS,
it is a condition
precedent to the
obligation of the
Company to
make the Trust Loan that, among other
things, the Trust execute and deliver this
Agreement to the Company,
NOW,
THEREFORE,
in consideration of
the Loan Agreement and the Trust Loan
and other good and valuable consideration
(the receipt, adequacy and sufficiency
of which the Trust acknowledges by its
execution hereof), the Trust intending to
be legally bound does hereby covenant and
agree with the Company as follows:
Section 1.
Pledge. To secure the
due and punctual
payment and performance
of the obligations of the Trust
hereunder and under
the Loan Agreement and the
Trust Note (collectively, the
"Liabilities"), the Trustee on behalf of the Trust
hereby pledges, hypothecates, assigns, transfers, sets over and delivers
unto
the Company, its successors and assigns and hereby grants to
the Company, its
successors and assigns a security interest
in:
(a) all Shares of Company Common Stock purchased or to be purchased
with the
proceeds of the Trust Loan (collectively, the "Pledged Shares")
and the
certificates representing or evidencing the Pledged Shares, and,
to
the extent
permitted by Section
4975(e)(7) of the Internal Revenue Code of
1986, as
amended, and Reg. ss. 54.4975-7(b)(5) promulgated thereunder, all
cash,
securities,
interest, dividends, rights and other property at
any
time and from
time to time received in respect of or in exchange for any or
all of the
Pledged Shares; and
(b) all proceeds of all of the foregoing
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(all such Pledged Shares, certificates,
cash, securities,
interest,
dividends,
rights and other property, and proceeds
thereof, other than as released, sold or
otherwise applied by the Company
pursuant to the terms
hereof, being herein
collectively called the "Collateral"), TO HAVE AND TO HOLD such
Collateral,
together with all rights, titles, interests, privileges and preferences
appertaining or incidental thereto, forever, subject, however, to the terms,
covenants and conditions hereafter set
forth.
Section 2.
Warranties and Covenants.
(a) The Trust
represents and
warrants to the
Company that the Trust
is, or at the
time of any future delivery, pledge, assignment or transfer
will be, the
lawful owner of the
Collateral, free of
all claims and liens
other than the
security interest hereunder, with full right to deliver,
pledge,
assign and transfer
the Collateral
to the Company as
Collateral
hereunder.
(b) So long as any of the Liabilities remain outstanding, the Trust
will, unless the
Company shall otherwise consent in writing:
(i) promptly
deliver
to the Company from time to time
certificates
representing Pledged Shares as the Trustee acquires them
and, upon request of the Company, such stock powers and other
documents,
satisfactory in form
and substance to the
Company, with
respect to the
Collateral as the
Company may reasonably
request to
preserve and protect, and to enable the Company to enforce, its
rights
and remedies hereunder;
(ii) not create or suffer to exist any lien, security interest
or
other charge or encumbrance against, in or with respect to any
of the
Collateral except for
the pledge hereunder and the security interest
created hereby;
(iii) not make or consent to any amendment or other modification
or waiver with
respect to any of the Collateral or enter into any
agreement or permit to
exist any restriction
with respect to any
of
the Collateral other than pursuant hereto; and
(iv) not take or fail to take any action which would in any
manner impair the value or enforceability of the Company's security
interest in any of the Collateral.
Section
3. Care of Collateral. The Company shall be deemed to have
exercised reasonable care with respect to the interest of the Trust in the
custody and preservation of the Collateral if it takes such action for
that
purpose as the Trust shall request in writing or as it would with
respect to
similar assets of its own, but failure of the Company to comply
with any such
request shall not of itself be deemed a
failure to exercise reasonable care.
2
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Section 4.
Certain Rights Regarding Collateral and Liabilities.
(a) The Company may from time to time, whether before or after any of
the Liabilities
shall become due and payable, without notice to the Trust,
to the extent
otherwise permitted
(i) retain or obtain a security interest
in the Collateral, to secure payment and performance of any of the
Liabilities,
(ii) retain or obtain
the primary or
secondary liability
of
any party or
parties, in addition
to the Trust, with respect to any of the
Liabilities,
(iii) extend or renew for any period
(whether or not
longer
than the
original period) or
exchange any of the Liabilities or release or
compromise any
obligation of any nature of any party with respect thereto,
and (iv)
surrender, release or exchange all or any part of any property,
in
addition to the
Collateral, securing
payment and performance of any of the
Liabilities,
or compromise
or extend or renew for
any period (whether
or
not longer than
the original period)
any obligations of any
nature of any
party with respect to any such
property.
(b) The Company shall
have no right to vote the Pledged Shares prior
to the
occurrence
of an Event of Default
(hereinafter
in Section 6(a)
hereof
defined). After the occurrence of an Event of Default,
the Trust
shall
have the right to vote any and all of the Pledged Shares in
accordance
with the Plan
unless and until it receives notice from the
Company that
such right has been
terminated with respect to shares subject
to execution as
a result of the Default.
Section 5.
Dividends, etc.
(a) So long as no Default or Event of Default, shall have occurred
and
be continuing, the Trust shall be entitled to receive any and all cash
dividends on the
Pledged Shares which it is otherwise entitled to receive,
and to vote the
Pledged Shares in accordance with the terms of the Plan and
to give
consents, waivers and ratifications in respect of the Pledged
Shares, but any
and all stock and/or liquidating dividends, distributions
in property, returns of capital or other distributions made on or in
respect
of the Pledged Shares, whether resulting from a subdivision,
combination or
reclassification
of the outstanding capital stock of any
issuer
thereof or received in
exchange for the Pledged Shares or any part
thereof or as a
result of any merger,
consolidation,
acquisition or other
exchange of
assets to which any issuer may be a party or otherwise, and any
and all cash and
other property
received in exchange
for any Collateral
shall be, and
become part of the
Collateral
pledged hereunder and, if
received by the
Trust, shall
forthwith be delivered
to the Company or its
designated
nominee (accompanied,
if appropriate, by
proper instruments of
assignment
and/or stock powers executed by the Trust in accordance with
the
Company's
instructions)
to be held subject to
the terms of this Agreement
and the
Plan.
(b) Upon the
occurrence and
during the
continuance
of an Event of
Default,
subject to the terms
of Section 4(b)
hereof, all rights of the
Trust
pursuant to Section
5(a) hereof
shall cease and the
Company shall
have the sole
and exc
