Exhibit 10.38.2


 


ENTERPRISE BANCORP, INC.


 


Nonqualified Stock Option Agreement


 


This Agreement made as of this (xx) day of (mmmmmm, yyyy) by and
between Enterprise Bancorp, Inc., a Massachusetts corporation (the “Company”),
and «FirstName» «EmployeeName» (the “Optionee”).


 


WITNESSETH THAT:


 


WHEREAS, the Company has instituted a program entitled “Enterprise
Bancorp, Inc. [Amended and Restated 1998] [2003] Stock Incentive Plan” (the “Plan”);
and


 


WHEREAS, the Compensation Committee of the Board of Directors, or the
full Board of Directors, as the case may be, of the Company has authorized the
grant of stock options upon the terms and conditions set forth below; and


 


WHEREAS, the Compensation Committee or the full Board of Directors, as
the case may be, has authorized the grant of this stock option pursuant and
subject to the terms of the Plan, a copy of which is attached hereto and
incorporated herein; and


 


WHEREAS, the Compensation Committee or the full Board of Directors, as
the case may be, has designated this stock option a nonqualified stock option
in accordance with Section 5 of the Plan;


 


NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, the Company and the Optionee agree
as follows.


 


1.             Grant.  Subject to the terms of the Plan and this
Agreement, the Company hereby grants to the Optionee a stock option (the “Option”)
to purchase from the Company «M_2004grant_»
shares of its common stock, $0.01 par value per share (“Stock”). This Option is
not intended to be an incentive stock option or to qualify for special federal
income tax treatment under Section 422 of the Code.


 


2.             Exercise Price.  This Option may be exercised at the exercise
price of $xx.xx per share of Stock, subject to adjustment as provided herein
and in the Plan.


 


3.             Term and
Exercisability of Option.  This
Option shall expire on the earlier of mmmm dd, yyyy or the last day of the
exercise period determined pursuant to subsection (c) of this Section 3. At any
time before its expiration, this Option may be exercised to the extent set
forth in the following schedule, provided that:


 


(a)           at
the time of exercise the Optionee is not in violation of any employee
confidentiality, noncompetition or other agreement with the Company or a
Subsidiary;


 


(b)           the
Optionee’s employment, contractual or other service relationship with the
Company or a Subsidiary (“Relationship”) must be in effect on the relevant date


 





















 


under the schedule set forth after subparagraph (c) below in order for
any scheduled increment in the exercisable portion of the Option to become
effective; and


 


(c)           this
Option may not be exercised if two months or more have elapsed following the
date of termination of the Relationship between the Optionee and the Company or
a Subsidiary; provided, however, that if the Relationship terminates as a
result of the Optionee’s retirement, “thirty-six months” shall be substituted
for “two months” in this sentence; and provided, further, that if the
Relationship terminates by reason of the Optionee’s permanent and total
disability (as determined by the Compensation Committee or the full Board of
Directors, as the case may be, on the basis of medical advice satisfactory to
it) or death, the Option must be exercised within twelve months of the Optionee’s
death or disability.


 


4.             Method
of Exercise.  Prior to its expiration
and to the extent that the right to purchase shares of Stock has vested
hereunder, this Option may be exercised from time to time by written notice to
the Company, substantially in the form attached hereto as Exhibit 1, stating
the number of shares with respect to which this Option is being exercised and
accompanied by either (a) payment in full of the exercise price for the number
of shares to be delivered, by means of payment acceptable to the Company in
accordance with Section 5(c) of the Plan, or (b) a description of a “cashless
exercise” procedure and such other documents and undertakings as are necessary
to satisfy that procedure. As soon as practicable after its receipt of such notice,
the Company shall, without transfer or issue tax to the Optionee (or other
person entitled to exercise this Option), deliver to the Optionee (or other
person entitled to exercise this Option), at the principal executive offices of
the Company or such other place as shall be mutually acceptable, a stock
certificate or certificates for such shares out of theretofore authorized but
unissued shares or reacquired shares of its Stock as the Company may elect;
provided, however, that the time of such delivery may be postponed by the
Company for such period as may be required for it with reasonable diligence to
comply with any applicable requirements of law. Payment of the exercise price
may be made in cash or cash equivalents or, in accordance with the terms and
conditions of Section 5(c) of the Plan, in whole or in part in shares of Common
Stock of the Company; provided, however, that the Compensation Committee or the
full Board of Directors, as the case may be, reserves the right upon receipt of
any written notice of exercise from the Optionee to require payment in cash
with respect to the shares contemplated in such notice; and provided, further,
that the Optionee may not make payment in shares of Stock that he acquired upon
the earlier exercise of any incentive stock option, unless he has held the
shares until at least two years after the date the incentive stock option was
granted and at least one year after the date the incentive stock option was
exercised. If the Optionee (or other person entitled to exercise this Option)
fails to pay for and accept delivery of all of the shares specified in such
notice upon tender of delivery thereof, his right to exercise this Option with
respect to such shares not paid for may be terminated by the Company.


 


5.             Withholding Taxes.  The Optionee hereby agrees, as a condition to
any exercise of this Option, to provide to the Company an amount sufficient to
satisfy the Company’s obligation to withhold certain federal, state and local
taxes arising by reason of such exercise (the “Withholding Amount”), if any, by
(a) authorizing the Company and/or a Subsidiary to withhold the Withholding
Amount from his cash compensation or (b) remitting the Withholding Amount to
the Company in cash; provided, however, that to the extent that the Withholding
Amount is


 


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not provided by one or a combination of such methods, the Company may
at its election withhold from the Stock that would otherwise be delivered upon
exercise of this Option that number of shares having a Fair Market Value, on
the date of exercise, sufficient to eliminate any deficiency in the Withholding
Amount.


 


6.             Nonassignability
of Option.  This Option shall not be
assignable or transferable by the Optionee except by will or by the laws of
descent and distribution.  During the
life of the Optionee, this Option shall be exercisable only by him, by a
conservator or guardian duly appointed for him by reason of his incapacity or
by the person appointed by the Optionee in a durable power of attorney
acceptable to the Company’s counsel.


 


6.              Nonassignability
of Option.  Except as otherwise
provided in this Section 6, this Option shall not be assignable or transferable
by the Optionee except by will or by the laws of descent and distribution.  Except as otherwise provided in this Section
6, during the life of the Optionee, this Option shall be exercisable only by
him, by a conservator or guardian duly appointed for him by reason of his
incapacity or by the person appointed by the Optionee in a durable power of
attorney acceptable to the Company’s counsel. 
In addition to the foregoing, the Optionee may transfer this Option to a
member of the Immediate Family (as hereinafter defined) of the Optionee, to a
trust solely for the benefit of the Optionee and the Optionee’s Immediate
Family or to a partnership or limited liability company whose only partners or
members are the Optionee and members of the Optionee’s Immediate Family.  For purposes of this Section 6, “Immediate
Family” shall mean, with respect to any Optionee, the Optionee’s child,
stepchild, grandchild, parent, stepparent, grandparent, spouse, sibling, mother-in-law,
father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law,
and shall include adoptive relationships.


 


7.             Compliance with
Securities Act; Lock-Up Agreement. 
The Company shall not be obligated to sell or issue any shares of Stock
or other securities pursuant to the exercise of this Option unless the shares
of Stock or other securities with respect to which this Option is being
exercised are at that time effectively registered or exempt from registration
under the Securities Act and applicable state securities laws. In the event
shares or other securities shall be issued that shall not be so registered, the
Optionee hereby represents, warrants and agrees that he will receive such
shares or other securities for investment and not with a view to their resale
or distribution, and will execute an appropriate investment letter satisfactory
to the Company and its counsel. The Optionee further hereby agrees that as a
condition to the purchase of shares upon exercise of this Option, he will
execute an agreement in a form acceptable to the Company to the effect that the
shares shall be subject to any underwriter’s lock-up agreement in connection
with a public offering of any securities of the Company that may from time to
time apply to shares held by officers and employees of the Company, and such
agreement or a successor agreement must be in full force and effect.


 


8.             Legends.  The Optionee hereby acknowledges that the
stock certificate or certificates evidencing shares of Stock or other
securities issued pursuant to any exercise of this Option may bear a legend
setting forth the restrictions on their transferability described in Section 7
hereof, if such restrictions are then in effect.


 


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9.             Rights as
Stockholder.  The Optionee shall have
no rights as a stockholder with respect to any shares covered by this Option until
the date of issuance of a stock certificate to him for such shares. No
adjustment shall be made for dividends or other rights for which the record
date is prior to the date such stock certificate is issued.


 


10.           Termination or
Amendment of Plan.  The Board may
terminate or amend the Plan at any time. No such termination or amendment will
affect rights and obligations under this Option to the extent it is then in
effect and unexercised.


 


11.           Effect Upon
Employment and Performance of Services. 
Nothing in this Option or the Plan shall be construed to impose any
obligation upon the Company or any Subsidiary to employ the Optionee or to
retain the Optionee in its employ or to engage or retain the services of the
Optionee.


 


12.           Time for Acceptance.  Unless the Optionee shall evidence his
acceptance of this Option by execution of this Agreement within thirty days
after its delivery to him, the Option and this Agreement shall be null and
void.


 


13.           Right of Repayment.  In the event that the Optionee accepts employment
with or performs services for a competitor of the Company within one year after
the date of exercise of this Option or any portion of it, the Optionee shall
pay to the Company an amount equal to the excess of the Fair Market Value of
the shares as to which the Option was exercised on the date of exercise over
the price paid for such shares; provided, however, that the Compensation
Committee or the full Board of Directors, as the case may be, in its discretion
may release the Optionee from the requirement to make such payment, if the
Compensation Committee or the full Board of Directors, as the case may be,
determines that the Optionee’s acceptance of such employment or performance of
such services is not inimical to the best interests of the Company. The Company
may deduct from any compensation or other amount payable by the Company to the
Optionee the amount of payment due under the preceding sentence. For purposes
of this Section 13, the term “Company” refers to the Company and all
Subsidiaries.


 


14.           General Provisions.


 


(a)           Amendment; Waivers.  This Agreement, including the Plan, contains
the full and complete understanding and agreement of the parties hereto as to
the subject matter hereof and, except as otherwise permitted by the express
terms of the Plan and this Agreement, it may not be modified or amended nor may
any provision hereof be waived, except by a further written agreement
duly signed by each of the parties; provided, however, that a modification or
amendment that does not materially diminish the rights of the Optionee
hereunder, as they may exist immediately before the effective date of the
modification or amendment, shall be effective upon written notice of its
provisions to the Optionee. The waiver by either of the parties hereto of any
provision hereof in any instance shall not operate as a waiver of any other
provision hereof or in any other instance.


 


(b)           Binding Effect.  This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective heirs, executors,
administrators, representatives, successors and assigns.


 


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(c)           Governing Law.  This Agreement has been executed in
Massachusetts and shall be governed by and construed in accordance with the
laws of The Commonwealth of Massachusetts.


 


(d)           Construction.  This Agreement is to be construed in
accordance with the terms of the Plan. In case of any conflict between the Plan
and this Agreement, the Plan shall control. The titles of the sections of this
Agreement and of the Plan are included for convenience only and shall not be
construed as modifying or affecting their provisions. The masculine gender
shall include both sexes; the singular shall include the plural and the plural
the singular unless the context otherwise requires. Capitalized terms not
defined herein shall have the meanings given to them in the Plan.


 


(e)           Notices.  Any notice in connection with this Agreement
shall be deemed to have been properly delivered if it is in writing and is
delivered by hand or facsimile or sent by registered mail, postage prepaid, to
the party addressed as follows, unless another address has been substituted by
notice so given:


 


	
  To the Optionee:

  	
   

  	
  To his address as set forth on the signature page hereof.

  
	
   

  	
   

  	
   

  
	
  To the Company:

  	
   

  	
  Enterprise Bancorp, Inc.

  
	
   

  	
   

  	
  222 Merrimack Street

  
	
   

  	
   

  	
  Lowell, Massachusetts 01852

  
	
   

  	
   

  	
  Attn: Mr. James A. Marcotte

  
	
   

  	
   

  	
   

  
	
  Copy to:

  	
   

  	
  Edwards & Angell, LLP

  
	
   

  	
   

  	
  101 Federal Street

  
	
   

  	
   

  	
  Boston, Massachusetts 02110

  
	
   

  	
   

  	
  Attn: Stephen J. Coukos, Esq.

  



 


IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed as a sealed instrument by its officer thereunto duly authorized as of
the date set forth below.


 


	
  Date of grant:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ENTERPRISE BANCORP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  James F Conway, III

  
	
   

  	
   

  
	
   

  	
  Chairman

  
	
   

  	
   

  
	
   

  	
  Compensation Committee

  
					



 


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ACCEPTANCE


 


I hereby accept the foregoing Option, a
nonqualified stock option, in accordance with its terms and conditions and in
accordance with the terms and conditions of the Enterprise Bancorp, Inc. [Amended
and Restated 1998] [2003] Stock Incentive Plan.


 


	
   

  	
   

  	
   

  	
   

  
	
  Date

  	
  (Signature of Optionee)

  
	
   

  	
   

  
	
   

  	
  «FirstName» «EmployeeName»

  
	
   

  	
   

  
	
   

  	
   

  
	
  Notice Address:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date of grant: [Date]

  	
   

  
					



 





















 


Exhibit 2 to


Nonqualified Stock


Option Agreement


 


[FORM FOR EXERCISE OF NONQUALIFIED STOCK
OPTION]


[SAMPLE ONLY]


 


 


Enterprise Bancorp, Inc.


222 Merrimack Street


Lowell, Massachusetts 01852


 


RE:                              Exercise of
Nonqualified Stock Option under Enterprise Bancorp, Inc. [Amended and Restated
1998] [2003] Stock Incentive Plan


 


Gentlemen:


 


I hereby elect to exercise the stock option granted to me on                         ,
200     by and to the extent of purchasing                           
shares of the Common Stock of Enterprise Bancorp, Inc. for the exercise price
of $                            
per share, subject to the terms and conditions of the Nonqualified Stock Option
Agreement between myself and Enterprise Bancorp, Inc. dated as of                     ,
200     (the “Agreement”).


 


Enclosed please find payment, in cash or in such other property as is
permitted under the Enterprise Bancorp, Inc. 2003 Stock Incentive Plan (the “Plan”),
of the purchase price for the shares.  If
I am making payment of any part of the purchase price by delivery of shares of
stock of Enterprise Bancorp, Inc., I hereby confirm that I have investigated
and considered the possible income tax consequences of making such payments in
that form.


 


I hereby agree to provide to Enterprise Bancorp, Inc. an amount sufficient
to satisfy its obligation to withhold certain taxes, in accordance with the
Agreement.


 


I further agree to any securities lock-up agreement between one or more
underwriters and shareholders of the Company who are officers or employees of
the Company or a Subsidiary, and any successor to that agreement, with regard
to the shares acquired upon this exercise of my stock option.


 


I hereby specifically confirm to Enterprise Bancorp, Inc. that I am
acquiring the shares for investment and not with a view to their sale or
distribution, and that the shares shall be held subject to all of the terms and
conditions of the Plan and the Agreement.


 


	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Date

  	
  (Signed
  by
                          
  or other party duly

  
	
   

  	
  exercising
  option)