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                                                                   Exhibit 10.38


                           BANYAN SYSTEMS INCORPORATED
                      NON-QUALIFIED STOCK OPTION AGREEMENT
                      ------------------------------------


1.   Grant of Options. Banyan Systems Incorporated, a Massachusetts corporation
     (the "Company"), hereby grants to William P. Ferry (the "Optionee"), an
     option to purchase an aggregate of 300,000 shares of Common Stock ("Common
     Stock") of the Company at a price of $8.75 per share, purchasable as set
     forth in and subject to the terms and conditions of this option. The date
     of grant of this option is October 21, 1999. Except where the context
     otherwise requires, the term "Company" shall include the parent and all
     present and future subsidiaries of the Company as defined in Sections
     424(e) and 424(f) of the Internal Revenue Code of 1986, as amended or
     replaced from time to time (the "Code").

2.   Non-Qualified Stock Option. This option is not intended to qualify as an
     incentive stock option within the meaning of Section 422 of the Code.

3.   Exercise of Option and Provisions for Termination.

     a.   Vesting Schedule. Except as otherwise provided in this Agreement, this
          option may be exercised prior to the tenth anniversary of the date of
          grant (hereinafter the "Expiration Date"), in whole or in part, from
          time to time, as to an aggregate number of shares equal to 300,000
          multiplied by a fraction, the numerator of which is the number of full
          months during which the Optionee has been employed by the Company from
          the date of grant (but not more than 36) and the denominator of which
          is 36; provided that that period from the commencement of this
          agreement until October 31, 1999 shall be considered a full month and
          the number of additional shares as to which this option shall become
          exercisable upon completion of the 36th month of this agreement shall
          be 8,310.

     b.   Change in Control. Upon the occurrence of a Change in Control, as
          defined in the Employment Agreement of even date herewith between the
          Company and the Employee (the "Employment Agreement"), this option
          shall become vested and exercisable as to 50% of the number of shares
          covered thereby that would not otherwise then be vested and
          exercisable (in reverse order of vesting), as provided for in Section
          3.3(b) of the Employment Agreement.

     c.   Certain Events. The vesting of this option shall also be subject to
          continuation and/or acceleration in accordance with the provisions of
          Section 5 of the Employment Agreement.

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     d.   Exercise Procedure. Subject to the conditions set forth in this
          Agreement, this option shall be exercised by the Optionee's delivery
          of written notice of exercise to the Treasurer of the Company,
          specifying the number of shares to be purchased and the purchase price
          to be paid therefore and accompanied by payment in full in accordance
          with Section 4.

     e.   Continuous Employment Required. Except as otherwise provided in this
          Section 3, this option may not be exercised unless Optionee, at the
          time he or she exercises this option, is, and has been at all times
          since the date of grant of this option, an employee of the Company.
          For all purposes of this option, (i) "employment" shall be defined in
          accordance with the provisions of Section 1.421-7(h) of the Income Tax
          Regulations or any successor regulations, and (ii) if this option
          shall be assumed or a new option substituted therefore in a
          transaction to which Section 424(a) of the Code applies, employment by
          such assuming or substituting corporation (hereinafter called the
          "Successor Corporation") shall be considered for all purposes of this
          option to be employment by the Company.

     f.   Exercise Period Upon Termination of Employment. If the Optionee ceases
          to be employed by the Company for any reason, then, except as provided
          in paragraphs (g) and (h) below, the right to exercise this option
          shall terminate three months after the later of cessation of
          employment or cessation of vesting (but in no event after the
          Expiration Date), provided that this option shall be exercisable only
          to the extent that the Optionee was entitled to exercise this option
          on the date of such cessation. The Company's obligation to deliver
          shares upon the exercise of this option shall be subject to the
          satisfaction of all applicable federal, state and local income and
          employment tax withholding requirements, arising by reason of this
          option being treated as a non-statutory option or otherwise.

     g.   Exercise Period Upon Death or Disability. If the Optionee dies or
          becomes disabled (within the meaning of Section 22(e)(3) of the Code)
          prior to the Expiration Date while he is an employee of the Company,
          or if the Optionee dies within three months after the Optionee ceases
          to be an employee of the Company (other than as a result of a
          discharge for "cause" as specified in paragraph (h) below), this
          option shall become exercisable, within the period of one year
          following the date of death or disability of the Optionee (but in no
          event after the Expiration Date), by the Optionee or by the person to
          whom this option is transferred by will or the laws of descent and
          distribution, provided that this option shall be exercisable only to
          the extent that this option was exercisable by the Optionee on the
          date of his death or disability. Except as otherwise indicated by the
          context, the term

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          "Optionee", as used in this option, shall be deemed to include the
          estate of the Optionee or any person who acquires the right to
          exercise this option by bequest or inheritance or otherwise by reason
          of the death of the Optionee.

     h.   Discharge for Cause. If the Optionee, prior to the Expiration Date,
          ceases his employment with the Company because he is discharged for
          "cause" (as defined in the Employment Agreement), the right to
          exercise this option shall terminate 30 days after such cessation of
          employment.

4. Payment of Purchase Price.

     a.   Method of Payment. Payment of the purchase price for shares purchased
          upon exercise of this option shall be made by delivery of cash or
          check in the amount equal to the exercise price of such options or,
          with the prior consent of the Company (which may be withheld in its
          sole discretion), by (A) delivery of shares of Common Stock owned by
          the Optionee for at least six months, valued at their fair market
          value, as determined in (b) below, (B) delivery of a promissory note
          of the Optionee to the Company on terms determined by the Board, (C)
          delivery of an irrevocable undertaking by a broker to deliver promptly
          to the Company sufficient funds to pay the exercise price or delivery
          of irrevocable instructions to a broker to deliver promptly to the
          Company cash or a check sufficient to pay the exercise price, (D)
          payment of such other lawful consideration as the Board may determine,
          or (E) any combination of the foregoing.

     b.   Valuation of Shares or Other Non-Cash Consideration Tendered in
          Payment of Purchase Price. For the purposes hereof, the fair market
          value of any share of the Company's Common Stock or other non-cash
          consideration which may be delivered to the Company in exercise of
          this option shall be determined in good faith or in the manner
          determined by the Board of Directors of the Company from time to time.


     c.   Delivery of Shares Tendered in Payment of Purchase Price. If the
          Optionee exercises options by delivery of shares of Common stock of
          the Company, the certificate or certificates representing the shares
          of Common Stock of the Company to be delivered shall be duly executed
          in blank by the Optionee or shall be accompanied by a stock power duly
          executed in blank suitable for purposes of transferring such shares to
          the Company. Fractional shares of Common Stock of the Company will not
          be accepted in payment of the purchase price of shares acquired upon
          exercise of this option.

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     d.   Restrictions on Use of Option Stock. Notwithstanding the foregoing, no
          shares of Common Stock of the Company may be tendered in payment of
          the purchase price of shares purchased upon exercise of this option if
          the shares to be so tendered were acquired within six months before
          the date of such tender through the exercise of this option or any
          other stock option or restricted stock agreement.

5.   Delivery of Shares; Compliance with Securities Laws, etc. The Company will
     not be obligated to deliver any shares of Common Stock or to remove
     restriction from shares previously delivered (i) until all conditions of
     the option have been satisfied or removed, (ii) until, in the opinion of
     Company's counsel, all applicable federal and state laws and regulations
     have been complied with, (iii) if the outstanding Common Stock is at the
     time listed on any stock exchange, until the shares to be delivered have
     been listed or authorized to be listed on such exchange upon official
     notice of notice of issuance, and (iv) until all other legal matters in
     connection with the issuance and delivery of such shares have been approved
     by the Company's counsel.

6.   Non-transferability of Option. This option is personal and no rights
     granted hereunder may be transferred, assigned, pledged or hypothecated in
     any way (whether by operation of law or otherwise) nor shall any such
     rights be subject to execution, attachment or similar process, except that
     this option may be transferred (i) by will or the laws of descent and
     distribution or (ii) pursuant to a qualified domestic relations order as
     defined in Section 414(p) of the Code. Upon any attempt to transfer,
     assign, pledge, hypothecate or otherwise dispose of this option or of such
     rights contrary to the provisions hereof, or upon the levy of any
     attachment or similar process upon this option or such rights, this option
     and such rights shall, at the election of the Company, become null and
     void.

7.   No Special Employment or Similar Rights. Nothing contained in this option
     shall be construed or deemed by any person under any circumstances to bind
     the Company to continue the employment or other relationship of Optionee
     with the Company for the period within which this option may be exercised.

8.   Rights as a Shareholder. The Optionee shall have no rights as a shareholder
     with respect to any shares which may be purchased by exercise of this
     option (including, without limitation, any rights to receive dividends or
     non-cash distributions with respect to such shares) unless and until a
     certificate representing such shares is duly issued and delivered to the
     Optionee. 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.

9.   Adjustment Provisions. In the event that the Board, in its sole discretion,
     determines that any stock dividend, extraordinary cash dividend,
     recapitalization, reorganization, merger, consolidate, split-up, spin-off,
     combination or other similar transaction affects the Common Stock such that
     an adjustment is required

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     in order to preserve the benefits or potential benefits intended to be made
     available under the Plan, then the Board shall equitably adjust either or
     both (i) the number and kind of shares subject to this option, and (ii) the
     award, exercise or conversion price with respect to the foregoing, and if
     considered appropriate, the Board may make provision for a cash payment
     with respect to this option, provided that the number of shares subject to
     this option shall always be a whole number.

10.  Mergers, Consolidation, Distributions, Liquidations, etc. Subject to the
     provisions of Section 3(b) above, in the event of a consolidation, merger
     or other reorganization in which all of the outstanding shares of Common
     Stock are exchanged for securities, cash or other property of any other
     corporation or business entity (an "Acquisition") or in the event of a
     liquidation of the Company, the Board of Directors of the Company, or the
     board of directors of any corporation assuming the obligations of the
     Company, may, in its discretion, take any one or more of the following
     actions as to this option: (i) provide that this option shall be assumed,
     or a substantially equivalent option shall be substituted by the acquiring
     or succeeding corporation (or an affiliate thereof) on such terms as the
     Board determines to be appropriate, (ii) upon written notice to the
     Optionee, provide that if unexercised, this option will terminate
     immediately prior to the consummation of such transaction unless exercised
     by the Optionee within a specific period following the date of such notice,
     (iii) in the event of an Acquisition under the terms of which holders of
     the Common Stock of the Company will receive upon consummation thereof a
     cash payment for each share surrendered in the Acquisition (the
     "Acquisition Price"), make or provide for a cash payment to the Optionee
     equal to the difference between (A) the Acquisition Price times the number
     of shares of Common Stock subject to outstanding options (to the extent
     then exercisable at prices not in excess of the Acquisition Price) and (B)
     the aggregate exercise price of all such outstanding options in exchange
     for the termination of such options, and (iv) provide that all or part of
     this option shall become exercisable or realizable in full prior to the
     effective date of such Acquisition.

11.  Withholding Taxes. The Company's obligation to deliver shares upon the
     exercise of this option shall be subject to the Optionee's satisfaction to
     all applicable federal, state and local income and employment tax
     withholding requirements. The Optionee shall pay to the Company, or make
     provision satisfactory to the Board for payment of, any taxes required by
     law to be withheld in respect of options under the Plan no later than the
     date of the event creating the tax liability. In the Board's discretion,
     and subject to such conditions as the Board may establish, such tax
     obligations may be paid in whole or in part in shares of Common Stock,
     including shares retained from the option creating the tax obligation,
     valued at their fair market value. The Company may, to the extent permitted
     by law, deduct any such tax obligations from any payment of any kind
     otherwise due to the Optionee.

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12.  Miscellaneous.

     a.   If any terms of this Option Agreement are contrary to or otherwise
          conflict with the terms of the Employment Agreement, the terms of the
          Employment Agreement shall control.

     b.   All notices under this option shall be mailed or delivered by hand to
          the parties at their respective addresses set forth beneath their
          names below or at such other address as may be designated in writing
          by either of the parties to one another.

     c.   This option shall be governed by and construed in accordance with the
          laws of the Commonwealth of Massachusetts.



                              BANYAN SYSTEMS INCORPORATED


                              BY:  /s/ Richard M. Spaulding
                                 ---------------------------------------
                                   Richard M. Spaulding
                                   Senior Vice President and
                                   Chief Financial Officer

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                              OPTIONEE'S ACCEPTANCE

     The undersigned hereby accepts the foregoing option and agrees to the terms
and conditions hereof.


                              OPTIONEE:  /s/ William P. Ferry
                                       --------------------------------
                                 William P. Ferry

                              Address:
                                      ---------------------------------

                              -----------------------------------------

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