Exhibit 10.2

TOWER BANCORP, INC.

GRAYSTONE FINANCIAL CORP.

2007 STOCK INCENTIVE PLAN

NONQUALIFIED STOCK OPTION AGREEMENT

FOR EMPLOYEE

THIS STOCK OPTION AGREEMENT (this “Agreement”) dated as of                     ,
         (the “Date of Grant”), is delivered by Tower Bancorp, Inc. (the
“Company”), a Pennsylvania bank holding company, as successor through merger to
Graystone Financial Corp., to                      (the “Grantee”), who is an
employee of the Company or one of its subsidiaries.

WITNESSETH:

WHEREAS, the Board of Directors of Graystone Financial Corp. adopted on
March 27, 2007, with subsequent shareholder approval on May 22, 2007, the
Graystone Financial Corp. 2007 Stock Incentive Plan (the “Plan”);

WHEREAS, pursuant to the merger of Graystone Financial Corp. with and into the
Company, the Company assumed the Plan as of March 31, 2009 and succeeded
Graystone Financial Corp. as sponsor of the Plan.

WHEREAS, the Plan permits the grant of nonqualified stock options to purchase
shares of the Company’s common stock, no par value per share (“Company Stock”),
to designated Employees (as defined in the Plan), in accordance with the terms
and provisions of the Plan, including anti-dilution adjustments; and

WHEREAS, the Grantee has been designated pursuant to the Plan to receive a
nonqualified stock option on the Date of Grant specified above; and

WHEREAS, this Agreement is intended to fulfill the requirement of the Plan that
Grants (as defined in the Plan) under the Plan shall be evidenced by a written
instrument.

NOW, THEREFORE, the Company intending to be legally bound, hereby agrees as
follows:

 

  1. GRANT OF OPTION. Subject to the terms and conditions hereinafter set forth
and the terms and conditions of the Plan, the Company grants to the Grantee, as
of the Date of Grant, a Nonqualified Stock Option (as defined in the Plan) to
purchase                      (        ) shares of Company Stock at a price of
$         per share. Such option is hereinafter referred to as this “Option” and
the price per share is referred to as the “option price.” The option price is
intended to be 100% of the Fair Market Value of a share of Company Stock as of
the Date of Grant, as determined in accordance with the Plan. The number of
shares of Company Stock subject to this Option and the option price are subject
to adjustment under circumstances set forth in the Plan.

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  2. OPTION TERM AND VESTING SCHEDULE.

2.1 The term of this Option shall be ten (10) years from the Date of Grant.

2.2 Unless vested earlier, by acceleration or otherwise, this Option will vest
in accordance with the following schedule:
                                                                 .
Notwithstanding anything to the contrary, including the foregoing vesting
schedule, this Option shall vest and become 100% exercisable upon a Change of
Control (as defined in the Plan) and as otherwise provided in the Plan.

 

  3. EXERCISE. Except as otherwise provided below, this Option may only be
exercised while the Grantee is an Employee of the Company. In the event of
Grantee’s termination of employment for any reason other than death, Disability
or Retirement (as such terms are defined in Section 5.6.4 of the Plan) or
following a Change of Control (as defined in Section 9.1 of the Plan), this
Option shall be exercisable only as to those shares of Company Stock that were
immediately purchasable by the Grantee at the date of termination and only for a
period of three (3) months following termination; provided that in no event
shall the exercise period extend beyond the expiration of the term of this
Option. In the event of a termination of a Grantee’s employment due to death,
Disability, Retirement or following a Change of Control, this Option shall vest
and become immediately exercisable and shall thereafter be exercisable by the
Grantee or the Grantee’s legal representative or beneficiaries, as applicable,
for a period of two (2) years following the date of such event, provided that in
no event shall the Option be exercised after the expiration of the term of this
Option.

 

  4. METHOD OF EXERCISE.

4.1 A Grantee may exercise this Option to the extent it is then exercisable
under the Plan, in whole or in part, by delivering a duly completed notice of
exercise, in such form as is acceptable to the Committee (as defined in the
Plan), to the Secretary or other officer of the Company designated by the
Committee, with accompanying payment of the option price in cash or any other
form of payment permitted pursuant to Section 5.7 of the Plan.

4.2 Unless otherwise provided by the Committee, such notice may instruct the
Company to deliver shares of Company Stock due upon the exercise of this Option
to a Designated Broker (as defined in the Plan) in lieu of delivery to the
Grantee. The Committee may suspend the ability of a Grantee to exercise this
Option through a Designated Broker at any time that the Committee, in its sole
discretion, determines appropriate.

 

  5.

NON-TRANSFERABILITY OF OPTION. The Option evidenced by this Agreement is not
transferable by the Grantee other than by will or by the laws of descent and
distribution or as may be otherwise permitted in accordance with the Plan.
During the lifetime of the Grantee, this Option may be exercised only by the

 

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Grantee. After the death of the Grantee, this Option may be exercised by the
representatives or other person entitled to succeed to the rights of the
Grantee, subject to the terms of the Option.

 

  6. INCORPORATION OF PLAN BY REFERENCE. This Option is granted pursuant to the
terms of the Plan, the terms of which are incorporated herein by reference and
this Option shall in all respects be interpreted in accordance with the Plan.
The Grantee acknowledges that he or she has received a complete copy of the Plan
and has read and is familiar with its provisions. The Committee shall interpret
and construe the Plan and this Agreement, and its interpretations and
determinations shall be conclusive and binding on the Company and the Grantee
and any other person claiming an interest hereunder, with respect to any issue
arising hereunder or thereunder. In the event of any conflict between the terms
of this Agreement and the Plan, the terms of the Plan shall control.

 

  7. GOVERNING LAW. Questions pertaining to construction, validity and effect of
the provisions of the Plan and this Agreement and the rights of all persons
hereunder and thereunder shall be governed by the laws of the Commonwealth of
Pennsylvania, without regard to the conflict of laws principles thereof.

 

  8. DEFINED TERMS. A capitalized term used and not otherwise defined in this
Agreement shall have the meaning provided for such term by the Plan.

IN WITNESS WHEREOF, the Company has caused its duly authorized officers to
execute and attest this Stock Option Agreement, and the Grantee has placed his
or her signature hereon, effective as of the Date of Grant.

 

ATTEST:      TOWER BANCORP, INC.

 

     By:   

 

(Asst) Secretary         Andrew Samuel, Chairman

Acceptance by Grantee

The undersigned Grantee, intending to be legally bound, hereby accepts and
agrees to the terms and provisions of the preceding Nonqualified Stock Option
Agreement and the Graystone Financial Corp. 2007 Stock Incentive Plan assumed by
Tower Bancorp, Inc. The Grantee acknowledges that he or she has received a
complete copy of the Plan and has read and is familiar with its provisions.

 

Date:                             

 

        Grantee

 

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