Form of Non-Qualified Stock Option Agreement FOR DIRECTORS


    Exhibit
      10.3

     

    
 

    [Date]

     

    Form
      of Non-Qualified Stock Option Agreement

    Under
      the Third Century Bancorp

    Stock
      Option Plan

    For
      Directors

     

    [Name
      of
      Optionee:]

     

    You
      are
      hereby granted the option to purchase a total of _______ shares of the Common
      Stock, without par value (“Common Stock”), of Third Century Bancorp (the
“Holding Company”) over the next ten years and one day pursuant to the Holding
      Company’s Stock Option Plan (the “Plan”), on the following terms and
      conditions:

     

    1.  The
      purchase price of the shares of Common Stock subject to this option is
      $___________ per share. You must pay this purchase price in cash at the time
      this option is exercised; provided, however that, with the approval of the
      Holding Company’s Stock Option Plan Committee (the “Committee”), beginning on
      and after June 30, 2007, you may exercise your option by tendering to the
      Holding Company whole shares of the Holding Company’s Common Stock owned by you,
      or any combination of whole shares of Holding Company Common Stock owned by
      you
      and cash, having a fair market value equal to the cash exercise price of the
      shares with respect to which the option is exercised by you. For this purpose,
      any shares so tendered shall be deemed to have a fair market value equal to
      the
      mean between the highest and lowest quoted selling prices for the shares on
      the
      date of exercise of the option (or if there were no sales on such date the
      weighted average of the means between the highest and lowest quoted selling
      prices on the nearest date before and the nearest date after the date of
      exercise of the option), as reported in The Wall Street Journal or a similar
      publication selected by the Committee. To exercise this option, you must send
      written notice to the Holding Company’s Secretary at the address noted in
      Section 10 hereof. Such notice shall state the number of shares in respect
      of
      which the option is being exercised, shall identify the option exercised as
      a
      non-qualified stock option, and shall be signed by the person or persons so
      exercising the option. Such notice shall be accompanied by payment of the full
      cash option price for such shares or, if the Committee has authorized the use
      of
      the stock swap feature provided for above, such notice shall be followed as
      soon
      as practicable by the delivery of the option price for such shares. Certificates
      evidencing shares of Common Stock will not be delivered to you until payment
      has
      been made. Under certain circumstances, the Plan permits you to deliver a notice
      to your broker to deliver the cash to the Holding Company upon the receipt
      of
      such cash from the sale of the Holding Company Common Stock. Contact the
      Secretary of the Holding Company for further information about this procedure
      if
      you are interested in it.

     

    2.  The
      term
      of this option (the “Option Term”) shall be for a period of ten years and one
      day from the date of this letter, subject to earlier termination as provided
      in
      paragraphs 3 and 4 hereof. The option may be exercised at any time, or from
      time
      to time, in whole or in part, until the Option Term expires, but in no case
      may
      fewer than 100 such shares be purchased at any one time, except to purchase
      a
      residue of fewer than 100 shares.

     

     

    
      
        
        

      

      
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    3.  If
      you
      are no longer a director or director emeritus of the Holding Company or its
      subsidiaries because of any reason other than death or disability, you may
      exercise this option, to the extent it was exercisable at the date you ceased
      to
      be a director, in whole or in part at any time within six (6) months after
      such
      date, but not later than the date upon which this option would otherwise expire.
      If you cease to be a director or director emeritus of the Holding Company or
      its
      subsidiaries because of your disability, you may exercise this option in whole
      or in part at any time within one (1) year after the date you ceased to be
      a
      director or director emeritus by reason of such disability, but not later than
      the date upon which this option would otherwise terminate.

     

    4.  If
      you
      die while serving as a director or director emeritus of the Holding Company
      or
      its subsidiaries, within six months after you are no longer a director or
      director emeritus of the Holding Company or its subsidiaries for reasons other
      than disability, or within one (1) year after the date you ceased to be a
      director or director emeritus by reason of your disability, this option may
      be
      exercised in whole or in part by your executor, administrator, or estate
      beneficiaries at any time within one (1) year after the date of your death
      but
      not later than the date upon which this option would otherwise
      expire.

     

    5.  This
      option is non-transferable otherwise than by will or the laws of descent and
      distribution or pursuant to a qualified domestic relations order. It may be
      exercised only by you or your guardian, if any, or, if you die, by your
      executor, administrator, or beneficiaries of your estate who are entitled to
      your option.

     

    6.  All
      rights to exercise this option will expire, in any event, ten years and one
      day
      from the date of this letter.

     

    7.  Certificates
      evidencing shares issued upon exercise of this option may bear a legend setting
      forth among other things such restrictions on the disposition or transfer of
      the
      shares of the Holding Company as the Holding Company may deem consistent with
      applicable federal and state laws.

     

    8.  Nothing
      in this option shall restrict the right of the Holding Company or its
      shareholders to terminate your service as a director at any time with or without
      cause.

     

    9.  This
      option is subject to all the terms, provisions and conditions of the Plan,
      which
      is incorporated herein by reference, and to such regulations as may from time
      to
      time be adopted by the Committee. A copy of the Plan has been furnished to
      you
      and an additional copy may be obtained from the Holding Company. In the event
      of
      any conflict between the provisions of the Plan and the provisions of this
      letter, the terms, conditions and provisions of the Plan shall control, and
      this
      letter shall be deemed to be modified accordingly.

     

    10.  All
      notices by you to the Holding Company and your exercise of the option herein
      granted, shall be addressed to Third Century Bancorp, 80 East Jefferson Street,
      Franklin, Indiana 46131, Attention: Secretary, or such other address as the
      Holding Company may, from time to time, specify.

     

     

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    11.  This
      option may not be exercised until the Holding Company has been advised by
      counsel that all other applicable legal requirements have been met.

     

    


     

    
      	 	
              Very
                truly yours,

               

            
	 	
              THIRD
                CENTURY BANCORP

               

            
	 	 	 
	 	
              By:

               

            	 
	 	 	
              Robert
                D. Heuchan, President and

              Chief
                Executive Officer

               

            


    

    


     

    Accepted
      on the date above written:

     

    _______________________________

    [Name
      of
      Optionee]

     

     

     

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