EXHIBIT 10.3

  

  

  

  

  

  
    NON-QUALIFIED STOCK OPTION AWARD AGREEMENT

    

    

    Granted by

    

    

    PROVIDENT BANCORP, INC.

    

    

    under the

    

    

    PROVIDENT BANCORP, INC.

    2020 EQUITY INCENTIVE PLAN

    

    

    This stock option agreement (“Option” or “Agreement”) is and will be subject in every respect to
      the provisions of the 2020 Equity Incentive Plan (the “Plan”) of Provident Bancorp, Inc. (the “Company”), which are incorporated herein by reference and made a part
      hereof, subject to the provisions of this Agreement.  A copy of the Plan and related prospectus have been provided to each person granted a stock option pursuant to the Plan.  The holder of this Option (the “Participant”)


      hereby accepts this Option, subject to all the terms and provisions of the Plan and this Agreement, and agrees that all decisions under and interpretations of the Plan and this Agreement by the committee appointed to administer the Plan (the “Committee”) or the Board of Directors will be final, binding and conclusive upon the Participant and the Participant’s heirs, legal representatives, successors and permitted assigns.  Except where the context
      otherwise requires, the term “Company” includes the parent and all present and future subsidiaries of the Company as defined in Section 424(e) and 424(f) of the Internal Revenue Code of 1986, as amended from time to time (the “Code”).  Capitalized terms used herein but not defined will have the same meaning as in the Plan.

    
      	1.	
              Name of Participant:__________________

            


    

    
      	2.	 Date of Grant:  __________, 202    . 


    

    
      	
              3.

            	
              Total number of shares of Company common stock, $0.01 par value per share, that may be acquired pursuant to this Option:
                _____________

                (subject to adjustment pursuant to Section 9 hereof).

               

              

            


    

    
      	
              •

            	
              This is a Non-Qualified Stock Option.

            


    

     

    

    
      	4.	
              
                Exercise price per share: $ _______

                (subject to adjustment pursuant to Section 9 below)

              

            


    

    	5.	
            Expiration Date of Option:  _________, 20      .  Notwithstanding anything in this Agreement to the contrary, no part of this Option may be exercised at any time on or after the expiration
              date.

          


    	6.	
            Vesting Schedule.  Unless sooner vested in accordance with the terms of the Plan and this Agreement, the Option granted hereunder will vest (i.e., become exercisable) in accordance with the following
              schedule:

          


    Vesting Date                   Number of Shares
        Exercisable

    

    

    [date] [#]

    [date] [#]

    [date] [#]

    [date] [#]

    [date] [#]

    
      
        


    

    
    

    

    As set forth in Section 10 of this Agreement, vesting will automatically accelerate pursuant to Sections 2.5, 2.7 and 4.1 of the Plan in the event of death or Disability or an
      Involuntary Termination of Service at or following a Change in Control.

    	7.	
            Exercise Procedure and Delivery of Notice of Exercise of Option.  This Option may be exercised in whole or in part by the Participant’s delivery to the Company of written notice (the “Notice of Exercise of Option” attached hereto as Exhibit A or as otherwise acceptable to the Company) setting forth the number of shares with respect to which this Option is to be exercised, together with
              payment by cash or other means acceptable to the Committee, in accordance with Section 2.2(b) of the Plan.

          


    	8.	
            Delivery of Shares.  Delivery of shares of Stock upon the exercise of this Option will comply with all applicable laws (including the requirements of the Securities Act) and the applicable
              requirements of any securities exchange or similar entity.

          


    

    

    
      	9.	
              Adjustment Provisions.

               

                

              This Option, including the number of shares subject to the Option and the exercise price, will be adjusted upon the occurrence of the events specified in, and in accordance with the provisions of, Section 3.4 of the Plan.

            


    

  

  
    	10.	
            Accelerated Vesting and Exercisability Period.

             

              

            
              The vesting of this Option will accelerate as set forth in the following  provisions:

            

          


  

  
    

    

    

    
      	
              (i)

            	
              Death.  In the event of the Participant’s Termination of Service by reason of death, any unvested portion of the Option subject to this Agreement will vest and any
                unexercised portion of the Option may thereafter be exercised by the Participant’s legal representative or beneficiaries for a period of one (1) year from the Participant’s death.

               

              

            


    

    
      	
              (ii)

            	
              Disability.  In the event of the Participant’s Termination of Service by reason of the Participant’s Disability, any unvested portion of this Option will vest and any
                unexercised portion of the Option may thereafter be exercised by the Participant or the Participant’s legal representative for a period of one (1) year following the Termination of Service due to Disability.

               

              

            


    

    
      	
              (iii)

            	
              Retirement.  In the event of the Participant’s Termination of Service by reason of Retirement, any unvested portion of this Option will immediately expire and be
                forfeited as of the date of the Termination of Service.  The Participant may exercise any Options vested as of that date for a period of one (1) year from the date of Termination of Service by reason of Retirement.

            


    

    

    

    
      	
              (iv)

            	
              Change in Control.  In the event of the Participant’s Involuntary Termination of Service at or following a Change in Control, any unvested portion of the Option will
                vest and any unexercised portion of the Option may be exercised by the Participant or the Participant’s legal representative for a period of one (1) year following the Participant’s Involuntary Termination of Service.

            


    

    

    

    
      	
              (v)

            	
              Termination for Cause.  In the event of the Participant’s Termination of Service for Cause, all Options subject to this
                Agreement that have not been exercised will immediately expire and be forfeited.

            


    

    
      2

      
        


    

    

    

    	

          	(vi)	
            Other Termination.  In the event of the Participant’s Termination from Service for any reason other than due to death, Disability, Retirement, Involuntary
              Termination at or following a Change in Control or for Cause, this Option may thereafter be exercised, only to the extent it was exercisable at the time of the termination and only for a period of three (3) months following the termination.

          


    

    

    11.   Miscellaneous.

    

    

    	

          	11.1	
            No Option will confer upon the Participant any rights as a stockholder of the Company prior to the date on which the individual fulfills all conditions for receipt of such rights.

          


    

    

    	

          	11.2	
            This Agreement may not be amended or otherwise modified unless evidenced in writing and signed by the Company and the Participant.

          


    

    

    	

          	11.3	
            At the discretion of the Committee, a Non-Qualified Option granted under the Plan may be transferable by the Participant, provided, however, that transfers will be limited to Immediate Family Members of Participants, trusts and
              partnerships established for the primary benefit of such family members or to charitable organizations, and provided, further, that the transfers are not made for consideration to the Participant.

          


    

    

    	

          	11.4	
            This Agreement will be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts.

          


    

    

    	

          	11.5	
            This Option will be subject to any required federal, state and local tax withholding, which may be effected in the manner or manners permitted by the Company.

          


    	

          	11.6	
            The granting of this Option does not confer upon the Participant any right to be retained in the service of the Company or any subsidiary.

          


    

    

    	

          	11.7	
            This Option is subject to forfeiture in accordance with the provisions of Section 7.17 of the Plan or as otherwise adopted by the Company.

          


    

    

    [Signature Page to Follow]

    
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    IN WITNESS WHEREOF, the Company has caused this Agreement to be executed in its name and on its behalf as of the date of grant of this Option set forth above.

    PROVIDENT BANCORP, INC.

    By:__________________________ 

      

    Its:__________________________

      

    

    

    PARTICIPANT’S ACCEPTANCE

    The undersigned hereby accepts the foregoing Option and agrees to the terms and conditions hereof, including the terms and provisions of the Plan.  The undersigned hereby
      acknowledges receipt of a copy of the Plan and related prospectus.

    PARTICIPANT

     

    

     

    

     

    

    ______________________________

    

    

    

    

    

     

    

    

    

    
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    EXHIBIT A

    NOTICE OF EXERCISE OF OPTION

    

    

    I hereby exercise the stock option (the “Option”) granted to me by Provident Bancorp, Inc. (the “Company”) or its affiliate, subject to all the terms and provisions set forth in the Non-Qualified
      Stock Option Agreement (the “Agreement”) and the Provident Bancorp, Inc. 2020 Equity Incentive Plan (the “Plan”) referred to therein, and notify you of my desire to purchase __________________ shares of common stock of the Company (“Common Stock”)
      for a purchase price of $______ per share.

    

    

    I elect to pay the exercise price by:

    

    

    	

          	___	
            Cash or personal, certified or cashier’s check in the sum of $_______, in full/partial payment of the purchase price.

          


    	

          	___	
            Stock of the Company with a fair market value of $______ in full/partial payment of the purchase price.*

          


    	

          	___	
            My check in the sum of $_______ and stock of the Company with a fair market value of $______, in full/partial payment of the purchase price.*

          


    

    

    	

          	___	
            A net settlement of the Option, using a portion of the shares obtained on exercise in payment of the exercise price of the Option (and, if applicable, any minimum required tax withholding).

          


    	

          	___	
            Selling  ______ shares from my Option shares through a broker in full/partial payment of the purchase price.

          


    I understand that after this exercise, ____________ shares of Common Stock remain subject to the Option, subject to all terms and provisions set forth in the Agreement and the
      Plan.

    I hereby represent that it is my intention to acquire these shares for the following purpose:

    ___ investment

    ___ resale or distribution

    

    

    Please note: if your intention is to resell (or distribute within the meaning of Section 2(11) of the Securities Act of 1933) the shares you acquire through this Option exercise,
      the Company or transfer agent may require an opinion of counsel that such resale or distribution would not violate the Securities Act of 1933 prior to your exercise of such Option.

    Date: ____________, _____.        _________________________________________

    Participant’s signature

    

    

    * If I elect to exercise by exchanging shares I already own, I
      will constructively return shares that I already own to purchase the new option shares.  If my shares are in certificate form, I must attach a separate statement indicating the certificate number of the shares I am treating as having
      exchanged.  If the shares are held in “street name” by a registered broker, I must provide the Company with a notarized statement attesting to the number of shares owned that will be treated as having been exchanged.  I will keep the shares that I
      already own and treat them as if they are shares acquired by the option exercise.  In addition, I will receive additional shares equal to the difference between the shares I constructively exchange and the total new option shares that I acquire.

  

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