Exhibit 10.2.3


 


EMPLOYMENT
AGREEMENT


 


This EMPLOYMENT AGREEMENT
made and entered into on the 19th day of December, 2008, by and between Enterprise Bancorp, Inc., a
Massachusetts corporation with a principal office at 222 Merrimack Street,
Lowell, Massachusetts 01852  (“Company”)  and its wholly owned
subsidiary, Enterprise Bank and Trust Company,
a Massachusetts trust company with its main office at 222 Merrimack Street,
Lowell, Massachusetts  01852 (“Bank”)(Bank
and Company being collectively referred to herein as the “Employer”), and John P. Clancy, Jr., who
resides at 11 Tanglewood Drive, Chelmsford, Massachusetts  01824 (the “Executive”), amends and restates
the Employment Agreement dated as of April 1, 2004, as amended.  The provisions of this Restatement are
effective as of April 1, 2008 (“Effective Date”).


 


W  I  T  N  E
S  S  E  T  H :


 


WHEREAS,
Executive has been employed by Employer for a substantial length of time and
the services of Executive, his experience, and his knowledge of the affairs of
Employer are of great value to Employer and Employer desires to continue to
employ Executive as its Chief Executive Officer under the terms and conditions
set forth below; and


 


WHEREAS, Executive desires to continue to be employed
by Employer as Chief Executive Officer upon the terms and conditions
hereinafter set forth;


 


NOW,
THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth, and for other good and valuable consideration, the
receipt and adequacy of which is hereby acknowledged, and intending to be
legally bound hereby, it is hereby agreed as follows:


 


1. Employment; Position; Term.  Employer hereby employs Executive, and
Executive agrees to be so employed, in the capacity of Chief Executive Officer
of Employer for a term commencing as of the Effective Date and ending on the
second anniversary of the Effective Date, April 1, 2010 (“Term of Employment”); provided,
however, that, commencing on the date one year after the
Effective Date, and on each annual anniversary of such date (such date and each
annual anniversary thereof, the “Renewal Date”), unless previously terminated,
the Term of Employment shall be automatically extended so as to terminate two
years from such Renewal Date, unless, at least 60 days prior to the Renewal Date,
either Employer or Executive gives notice to the other that the Term of
Employment shall not be so extended (“Notice of Non-Renewal”).  By way of example, on April 1,
2009, the Term of Employment shall be extended from a term ending on April 1,
2010  to a term ending on April 1,
2011. Upon the timely delivery by either party of a Notice of Non-Renewal, the
Term of Employment shall no longer be subject to the automatic extension
provided for 


 


GALLAGHER &
CAVANAUGH, LLP, 100 FOOT OF JOHN STREET, LOWELL, MASSACHUSETTS 01852


 

















 


herein, but rather shall
expire upon the conclusion of the then Term of Employment (“Expiration of Term
Due to Non-Renewal”).  By way of example,
if a Notice of Non-Renewal were first delivered on November 1, 2009, the
Term of Employment would expire on April 1, 2011. A Notice of Non-Renewal
may not be delivered by Employer during the two year period immediately
following a Change in Control event (as hereinafter defined).  Executive’s
service as a director of Employer and/or any Affiliate (as hereafter
defined), shall be without any further compensation in addition to that set
forth herein.


 


2. Duties; Place of
Employment; Time and Efforts.


 


2.1                               Duties.  During the Term of Employment,
Executive shall exercise and assume such duties, responsibilities and
authorities as are provided in the bylaws of Employer with respect to holding
the office of Chief Executive Officer. 
Executive shall at all times discharge his duties in consultation with
and under supervision of and shall report directly to the Board of
Directors.  Notwithstanding the above,
Executive shall not be required to perform any duties and responsibilities
which would result in Employer’s or Executive’s noncompliance with, or any
other violation of, any applicable law, regulation, regulatory policy or other
regulatory requirement.


 


2.2                               Place
of Employment.  Executive shall
render his services primarily at Employer’s office in Lowell, Massachusetts.
Executive shall travel as reasonably required for the performance of his duties
hereunder.


 


2.3                               Time
and Efforts.  During the Term of
Employment, Executive shall, except for periods of absence occasioned by
illness, vacation, and any other reasonable leaves of absence in accordance
with applicable policies, programs, procedures or practices of Employer,
diligently and conscientiously devote his full business time and attention and
best efforts, business skills, ability and fidelity to the business of Employer
and the discharge of his duties hereunder; provided, however, that Executive may, so long
as such activities (individually and collectively) do not conflict or
materially interfere with the performance of Executive’s duties hereunder (a) continue
to serve on any boards and committees on which Executive is presently serving
or in a position which Executive currently holds provided same has been
disclosed to Employer on a schedule attached to this Agreement; (b) manage
his personal financial affairs, including his personal passive
investments;  (c) serve on boards of
directors or trustees or committees of civic or charitable organizations or
trade associations, and (d) with the written consent of the Board of
Directors, as evidenced by a formally adopted vote or resolution and subject to
such terms and conditions specified in any such vote or resolution, serve as a
non-employee director, trustee, manager or partner of any business entity.


 


3. Compensation and Other
Benefits.


 


3.1                               Base Salary. In consideration of the services of
Executive, 


 


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Employer shall pay to
Executive a base salary of $350,000.75 per annum, together with such
increases as the Board of Directors of Employer may from time to time approve
in its sole discretion (but such shall be reviewed by the Board at least annually),
in equal installments in accordance with the customary payroll practices of
Employer (“Base Salary”).


 


3.2                               Annual
Cash Bonus. During the Term of Employment, Executive shall be entitled
to participate in an equitable manner with other executive officers of Employer
in such discretionary bonus payment or awards as may be authorized, declared and/or paid by the Board of Directors to Employer’s
executive employees.  Nothing in this
Agreement, however, shall be construed to require Employer to establish, maintain
or continue any bonus plan, program or arrangement.  Except as otherwise expressly provided by
their terms, such bonus plan, programs or arrangements are subject to
modification or termination by Employer at any time in its sole
discretion.  No other compensation or
additional benefits provided for in this Agreement shall be deemed to be
a substitute for Executive’s right to receive such bonuses if, when and as
declared and paid by the Board of Directors.


 


3.3                               Incentive,
Retirement, and Savings Plans.  During
the Term of Employment, Executive shall
be entitled to participate in all incentive, pension, retirement, savings,
stock option and other stock grant and equity compensation plans, as well as
all other nonseverance related benefits, plans and programs, which may be
maintained from time to time by Employer for the benefit of senior executives
and/or other employees of Employer.


 


3.4                               Welfare
Benefit Plans.  During the Term
of Employment, Executive and his spouse and other eligible dependents shall be
entitled to participate in, and be covered by, all of the health and other
welfare benefit plans and programs that may be maintained from time to time by
Employer for the benefit of senior executives and/or other employees of
Employer.  In the case of any group
disability plan maintained by Employer, Employer shall provide Executive the
opportunity to pay directly by payroll deduction or otherwise all or any
portion of the premium on any policy or policies providing such coverage.


 


3.5                               Expense
Reimbursement.  During the Term
of Employment, Executive shall be entitled to receive prompt reimbursement for
all reasonable expenses, including reasonable business travel expenses,
incurred by Executive in performing his duties and responsibilities under this
Agreement, in accordance with the
policies, programs, procedures and practices of Employer as in effect at the
time the expense was incurred. To the extent necessary to avoid characterizing
any reimbursement to Executive as deferred compensation under Section 409A
of the Internal Revenue Code of 1986, as amended (the “Code”)  and the United States Treasury regulations
then in effect (“Treas. Regs.”), such reimbursements shall be paid on or before
March 1 following the close of the calendar year in which the expense was
incurred by Executive.  


 


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Amounts which are not submitted within the required timeframe shall not
be eligible for reimbursement hereunder.


 


3.6                               Fringe
Benefits; Automobile.  During the
Term of Employment, Executive shall be eligible to benefit from such fringe
benefits and perquisites, in accordance with the policies, programs, procedures
and practices of Employer, as may be in effect and provided from time to time
to senior executives and/or other employees of Employer, and shall be entitled
to the use of an automobile, of a type commensurate with Executive’s office and
standing, at Employer’s expense.


 


3.7                               Vacation.  Executive shall earn and accrue twenty-six
(26) days of vacation for each twelve month period served during the Term of
Employment.  Executive shall be entitled
to the continuation of his Base Salary and benefits during vacations to be
scheduled at the reasonable convenience of the parties hereto.  Vacation will be earned ratably over the
course of each such twelve month period and shall be used in accordance with
Employer’s policies.


 


4. Termination. Unless Executive’s employment is terminated pursuant to
this Section 4, Employer will continue to employ Executive and Executive
will continue to serve Employer throughout the Term of Employment. Termination of Executive’s employment will
constitute an automatic termination of all other positions held by Executive
including service as a director, unless otherwise requested by Employer.


 


4.1                               Expiration
of the Term Due to Non-Renewal.  Upon
Expiration of Term Due to Non-Renewal, Executive’s employment with Employer
will be terminated (herein “date of termination”) without further action by
Executive or Employer and Executive will be entitled to receive the following:


 


(a)                                  earned
and accrued but previously unpaid Base Salary through the date of termination ,


 


(b)                                 payment
in respect of any vacation days accrued but unused through the date of
termination,


 


(c)                                  reimbursement
of any remaining expense properly incurred in accordance with Employer’s policy
prior to the date of termination and not yet reimbursed by Employer,


 


(d)                                 any
bonus actually awarded or earned, but not yet paid as of the date of
termination,  and


 


(e)                                  any
vested benefits under any insurance policy, pension, retirement, savings, stock
option and other stock grant and equity compensation plans, together with any
other non-severance related compensation and benefits as may be provided in
accordance with the terms and provisions of any other agreements between
Executive and 


 


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either Company or Bank and any applicable plans,
programs, procedures and practices of Employer.


 


The aggregate
benefits payable pursuant to clauses (a), (b), (c) and (d) are
hereafter referred to as the “Accrued Obligations.”  The vested benefits referenced in clause (e) are
hereafter referred to as the “Additional Benefits.”


 


4.2                               Death. The employment of Executive hereunder shall terminate
immediately upon his death; provided, however, that in the event of death,
the Employer will pay to the beneficiary named on the Designation of
Beneficiary form completed by Executive the following:


 


(a)                                  the
Accrued Obligations,


 


(b)                                 the
Additional Benefits,


 


(c)                                  a
lump sum amount equal to six month’s of Base Salary at the rate in effect on
the date of death, payable within thirty (30) days of the date of death (“Lump
Sum Payment”), and


 


(d)                                 continuation,
at no cost to Executive’s spouse and other eligible dependents, of all health
and other welfare benefits provided under Section 3.4 of this Agreement
for the benefit of Executive’s spouse and other eligible dependents for a
period commencing on the date of death and ending, with respect to Executive’s
spouse, on the earlier of her death or remarriage and, with respect to any
other eligible dependent of Executive, the date such dependent is no longer
eligible for such coverage in accordance with the terms of any applicable plan.


 


4.3                               Disability.  Employer
will have the right to suspend Executive’s employment hereunder in the event
Executive becomes disabled (“Disability Suspension”), by giving written notice
of same to Executive (“Notice of Disability Suspension”).  Executive’s Disability Suspension shall
become effective upon the 30th day following the date of the Notice
of Disability Suspension (“Disability Suspension Effective Date”).  For purposes of this Agreement, disability
shall mean (1) Executive is unable to engage in any substantial gainful
activity by reason of any medically determined physical or mental impairment
that can be expected to result in death or to last for a continuous period of
not less than twelve (12) months, or (2) Executive is, by reason of any
medically determinable physical or mental impairment that can be expected to
result in death or can be expected to last for a continuous period of not less
than twelve (12) months, receiving income replacement or disability  benefits for a period of not less than three (3) months
under any group long-term disability plan or accident and health plan then
maintained by Employer.  In the event
that Executive returns to full-time employment with Employer following the
Notice of Disability Suspension but prior to the Disability Suspension
Effective Date, the Notice of Disability Suspension shall be deemed
automatically withdrawn.  In any event,
the period of Disability Suspension will 


 


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end on the earliest to occur of the following (“Disability Termination
Date”):  (A) the date on which
Executive returns to full-time employment with Employer; (B) Executive’s
death, in which event the provisions of Section 4.2 shall govern; or (C) the
termination by either party or the expiration of the Term of Employment, in
each case in accordance with the terms of this Agreement.


 


Employer shall pay to Executive, as of the Disability
Suspension Effective Date, the Accrued Obligations.  During the period of Disability Suspension up
until the Disability Termination Date Executive shall:


 


(a)                                  receive
an amount equal, on a per annum basis, to seventy-five percent (75%) of
Executive’s Highest Annual Compensation, as hereafter defined, as determined on
the Disability Suspension Effective Date. 
Such amount shall be paid by Employer, commencing on the first ordinary
payroll payment date following the Disability Suspension Effective Date, in
equal periodic installments in accordance with Employer’s ordinary payroll
practices in effect at the time of such payments are made.  The payments made pursuant to this provision
shall be in addition to any payments or other benefits payable to Executive
under any qualified or nonqualified retirement plans or programs maintained by
Employer but shall be reduced by any payments received by Executive during such
Disability Suspension under any group long-term disability plan maintained by
Employer;


 


(b)                                 continue
to accrue and participate in all incentive, pension, retirement, savings, stock
option and other stock grant and equity compensation plans, as well as all other
employee benefit plans and programs, which are referenced in Section 3.3;
and


 


(c)                                  continue
to receive all life, health and other welfare coverage and benefits as set
forth in Section 3.4, including those for the benefit of Executive’s
spouse and other eligible dependents.


 


From and after the Disability Suspension Effective
Date, Employer shall be free to fill Executive’s positions; provided, however,
that if Executive is able to return to full-time employment with Employer at
any time during the period of Disability Suspension prior to the Disability
Termination Date, Executive shall resume his positions and duties with Employer
unless Employer has filled either of those positions and does not reappoint
Executive to both such positions, in which event, Executive may, at his option:


 


(i)                                     assume
the position(s) and duties that Employer may assign to him at the same
Base Salary as was in effect on the Disability Suspension Effective Date and,
otherwise, on the same terms and conditions as set forth herein; or


 


(ii)                                  in
the event that the position and duties assigned to him would constitute a
material diminution in his authority, duties 


 


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or responsibilities or
otherwise constitute Good Reason, as hereinafter defined, Executive may
exercise his right to terminate this Agreement for Good Reason pursuant to Section 4.5.


 


In the event that Executive refuses to assume the
position and duties assigned to him pursuant to Clause (i) under
circumstances that do not constitute Good Reason, such shall constitute a
Voluntary Termination by Executive subject to Section 4.6 below.


 


Notwithstanding any other provision contained in this
Agreement to the contrary, the occurrence of a Disability Suspension shall not
in any way prevent or otherwise limit the parties from exercising any of their
respective rights to terminate the Term of Employment at any time in accordance
with the terms of this Agreement or from delivering Notice of Non-Renewal
pursuant to Section 1.


 


Further, nothing in this Section shall be deemed
as a waiver by Executive of his right to unpaid leave under the Family and
Medical Leave Act of 1993, the Americans with Disabilities Act of 1990, or any
analogous provision of state law.


 


4.4                               For Cause.  Subject to compliance with the procedure set
forth herein, Employer will have the right to terminate Executive’s
employment for Cause.   For purposes of
this Agreement, “Cause” means: (i) Executive’s willful and continued
failure to substantially perform his employment duties (other than any such
failure resulting from Executive’s illness or disability, which shall be
subject to the provisions of the preceding Section), or (ii) Executive’s
willfully engaging in conduct (other than conduct related to the operation of
an automobile) which is demonstrably and materially injurious to Employer,
monetarily or otherwise; provided, however, that no act or failure to
act, on the part of Executive shall be deemed “willful” unless done, or omitted
to be done, by Executive not in good faith and without reasonable belief that
Executive’s act or failure to act, was in the best interest of Employer. Upon
such termination, Executive will thereafter be entitled to receive only the
compensation and benefits set forth in Section 4.1 (a) through (e) hereinabove
applicable to Expiration of the Term Due to Non-Renewal.


 


(a) Procedure.  At a
meeting of the applicable Employer’s Board of Directors, duly called for the
purpose of determining whether Cause exists (“Determination Meeting”), the alleged
acts or omissions of Executive must be found by two-thirds of the disinterested
directors present at the meeting to have been established beyond reasonable
doubt.   For purposes of this Section 4.4,
“disinterested” shall mean those directors other than the Executive and any
other directors who are alleged to have been involved or otherwise to have an
interest in any of such alleged acts or omissions of the Executive.  If said Board determines, as set forth in the
preceding sentence, that Cause exists, said Employer shall deliver, within ten (10) days
of the Determination Meeting, written notice to Executive of same which shall
set forth, in reasonable detail, the findings of the Board 


 


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as to the act(s) and/or
omission(s), including the dates, facts and circumstances, constituting Cause
(“Notice of Termination For Cause”).  The
Notice of Termination For Cause shall also advise Executive that unless an
Opportunity Notice, as hereinafter defined, is delivered by Executive as
hereinafter provided, Executive’s employment shall terminate for Cause
effective on the eleventh (11th) day
after the receipt by Executive of the Notice of Termination For Cause.  Executive may, within ten (10) days of
his receipt of the Notice of Termination For Cause, request, by written notice
delivered to said Employer, that a special meeting of the Board be called for
the purpose of providing Executive an opportunity to appear before the Board,
with counsel, to discuss such act(s) or omission(s) (“Opportunity
Notice”).  Upon receipt of the
Opportunity Notice, a special meeting of the Board shall be duly called to take
place on a date selected by the Board, which is not less than ten (10) nor
more than thirty (30) days after Employer’s receipt of the Opportunity Notice,
at the principal office of said Employer or such other locations as has been
mutually agreed upon by Employer and Executive (“Final Meeting”).  If the Board does not, by vote of greater
than one-third of the disinterested directors present at the meeting, rescind
its Notice of Termination For Cause at the Final Meeting or Executive fails to
attend the Final Meeting for any reason other than either a valid medical
reason or a reason that is deemed credible and sufficient by the acting
Chairman of the Board in his or her sole and absolute discretion (in which
event, the Chairman shall reschedule the Final Meeting to a date selected by
him or her that is practical in light of the reason for Executive’s failure to
attend), Executive’s employment shall be terminated for Cause effective
immediately as of the conclusion of the Final Meeting, without further
notice.  The procedure set forth herein
shall at all times be subject to the requirements of applicable law,
regulation, regulatory policy or other regulatory requirements.


 


(b) Suspension. 
Notwithstanding anything to the contrary in this Agreement, during the
period commencing on the date on which notice of the Determination Meeting is
duly given to the Board and ending the earliest of the date of (i) the
Determination meeting, if no determination of Cause is made at said meeting as
hereinabove provided,  (ii) the date
of termination (which may be either the eleventh day following Executive’s
receipt of the Notice of Termination For Cause if an Opportunity Notice is not
delivered by Executive as hereinabove provided or the date of the Final Meeting
if an Opportunity Notice is provided and the Notice of Termination of Cause is
not rescinded at such meeting), or (iii) the date of the Final Meeting if
the Notice of Termination For Cause is rescinded as set forth in Subsection (c) below:


 


(1) Executive,
in the sole discretion of the Board may be 


 


8

















 


suspended from employment
with Employer and the Board may, during such period, reasonably limit
Executive’s access to the principal offices and any other premises of Employer
and/or Executive’s access to any of Employer’s assets or personnel; and


 


(2) 
Executive shall continue to receive his Base Salary and all benefits in
accordance with Section 3 of this Agreement to the extent such payments
and benefits are not prohibited by applicable law, regulation, regulatory
policy or other regulatory requirement.


 


(c)                                Rescission
of Notice of Termination For Cause. 
In the event that the Final Meeting is not called as provided for
herein, or a quorum of the Board fails to appear for the Final Meeting, or the
Board votes to rescind its Notice of Termination for Cause then such Notice
shall be deemed rescinded and Executive shall be returned to his duties as of
the date of such rescission.


 


(d)                                 Timeliness.  No event shall constitute grounds for a
“Cause” termination in the event that Employer fails to take action within 90
days after Employer’s Chairman or the Chairman of Employer’s Audit Committee
obtains knowledge of the occurrence of such event.


 


(e)                                  Payment upon Termination For Cause.  If Executive’s employment shall be terminated
for Cause as set forth herein, Employer shall pay Executive:


 


(i)                                     the
Accrued Obligations, and


 


(ii)                                  the
Additional Benefits, in accordance with the terms of the applicable plan,
program or arrangement.


 


4.5                               Involuntary
Termination.


 


4.5.1                     Termination
by Employer Without Cause.  Employer
may, unilaterally, terminate Executive’s employment for any reason and without
Cause or for no reason at all at any time during the Term of Employment upon
sixty (60) days prior written notice to Executive.  If Employer terminates Executive’s employment
pursuant to this Section 4.5.1, then the Term of Employment shall
thereupon end (“Date of Involuntary Termination”) and Executive shall, subject
to Bank Regulatory Limitations as referenced in Section 4.14, only be
entitled to receive the following:


 


(a)                                  the
Accrued Obligations; provided, however, that in addition to the
payment of the per diem value of any unused vacation days that have accrued
during the Term of Employment prior to the Date of Involuntary Termination,
Executive shall receive the unused, unaccrued portion of any vacation days available
through the end (but not beyond) the calendar year in which the Date of
Involuntary Termination occurs,


 


(b)                                 the
Additional Benefits,


 


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(c)                                  an
aggregate amount equal to two times Executive’s Highest Annual Compensation, as
hereinafter defined (“Severance Payment”), such amount shall be paid no later
than two and one-half (2 1⁄2) months after the close of the taxable year of
Executive or Employer in which the Date of Involuntary Termination occurs,


 


(d)                                 to
have Employer pay the full premiums (employer and employee portions) for
Executive’s and any covered beneficiary’s coverage under COBRA health
continuation benefits over the eighteen (18) month period immediately following
the date of termination.  Notwithstanding
the foregoing, if Executive accepts post-employment with another entity that
provides comparable healthcare, during such period, Employer shall not provide
Executive with such health continuation benefits, and


 


(e)                                  reimbursement
for the reasonable fees of a professional out-placement service selected by
Executive; provided, however, that only expenses incurred by Executive no later
than the end of the second taxable year following the year in which the Date of
Involuntary Termination occurs shall be reimbursed and such reimbursement shall
be paid by the end of the third taxable year following the year in which the
Date of Involuntary Termination occurs.


 


4.5.2                     Termination
by Executive For Good Reason. Executive may terminate his employment
for Good Reason.  Upon a termination by
Executive for Good Reason, Executive shall be entitled to the same payments and
benefits as provided in Section 4.5.1 above.  In no event shall a termination of Executive’s
employment for Good Reason occur unless and until Executive provides Employer,
within ninety (90) calendar days following the date on which the facts and
circumstances underlying the finding of Good Reason reasonably could have been
known by Executive, with written notice thereof stating with specificity the
facts and circumstances underlying the finding of Good Reason and, if the basis
for such finding of Good Reason is capable of being cured by Employer,
providing Employer with an opportunity to cure the same within thirty (30)
calendar days after receipt of such notice. 
If Executive terminates his employment pursuant to this Section 4.5.2,
then the Term of Employment shall end upon the receipt by Employer of the
notice required by this Section 4.5.2; provided, however, that if the basis for such
finding of Good Reason is capable of being cured but Employer fails to cure as
hereinabove provided, the Term of Employment shall end  on the thirty-first calendar day following
such notice (“Date of Involuntary Termination”).


 


“Good Reason”
shall mean, without Executive’s prior written consent, the occurrence of any of
the following events or actions:


 


(a)                                  material
diminution of Base Salary ;


 


(b)                                 material
diminution in Executive’s authority, duties or 


 


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responsibilities;


 


(c)                                  material
diminution in the authority, duties or responsibilities of the supervisor to
whom Executive is required to report, including a requirement that Executive
report to a corporate officer or employee instead of directly to the Board of
Directors;


 


(d)                                 material
diminution in the budget over which Executive retains authority;


 


(e)                                  material
change in geographic location at which Executive must perform the services; or


 


(f)                                    any
other action or inaction that constitutes a material breach of the terms of an
applicable employment agreement including, but not limited to Employer’s
failure to obtain a satisfactory agreement from any successor(s) to assume
and agree to perform Employer’s obligations under this Agreement.


 


In order to constitute an Involuntary Termination under this Section 4.5.2,
Executive must actually terminate his employment pursuant to this Section 4.5.2
within six (6) months following the date on which the facts and
circumstances underlying the finding of Good Reason reasonably could have been
known by Executive.


 


4.6                               Voluntary
Termination.  Executive shall
give Employer not less than sixty (60) days’ prior written notice of his
intention voluntarily to terminate his employment by Employer other than for
Good Reason. If Executive terminates his employment on his own initiative
without Good Reason and under circumstances other than (i) a termination
due to death, (ii) a termination due to Retirement, or (iii) an
Expiration of the Term due to Non-Renewal, then Executive upon such termination
(“Voluntary Termination”), will only be entitled to receive the following:


 


(a)                                  the
Accrued Obligations, and


 


(b)                                 the
Additional Benefits, in accordance with the terms of the applicable plan,
program or arrangement.


 


4.7                               Termination
Due to Retirement.  During the
Term of Employment, Executive may, upon reaching sixty-two (62) years of age,
voluntarily terminate his employment hereunder by giving not less than sixty
(60) days prior written notice to Employer (“Retirement”).  Upon expiration of said sixty (60) day notice
period (“Retirement Effective Date”), Executive will only be entitled to
receive the following:


 


(a)                                  the
Accrued Obligations,


 


(b)                                 the
Additional Benefits, in accordance with the terms of the applicable plan,
program or arrangement,


 


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(c)                                  any
rights to indemnification in accordance with Section 6 of this Agreement,


 


(d)                                 to
continue, together with his spouse and eligible dependents, participation in
the welfare benefits described in Section 3.4 (collectively, the “Continuing
Benefit Plans”); provided, however, that coverage (with regard
to medical and dental benefits for the period after the end of the eighteen
(18) month period following the date of termination) shall, unless same is a
nontaxable benefit excludible from income under Section 105 of the Code,
be deemed to be monthly, in-kind payments of the premiums and will be taxable
income to Executive; and provided, further, that the participation by
Executive (and, to the extent applicable, Executive’s spouse and dependents) in
any Continuing Benefit Plan shall cease on the date, if any, on which Executive
becomes eligible for comparable benefits under a similar plan, policy  or program of a subsequent employer (“End
Date”).  Executive’s participation in the
Continuing Benefit Plans will be on the same terms and conditions that would
have applied had Executive continued to be employed by Employer through the End
Date.  To the extent any such benefits
cannot be provided under the terms of the applicable plan, policy or program,
Employer shall provide (or shall cause to be provided) a comparable benefit
under another plan.


 


4.8                               Highest
Annual Compensation.  “Highest Annual
Compensation” means, as determined as of the date of termination of Executive’s
Term of Employment under the applicable termination provision set forth above,
the sum of (a) the highest per annum rate of base salary paid by Employer
to Executive at any time during the Term of Employment prior to such date of
termination, and (b) the highest annual cash performance bonus or other
annual cash incentive compensation paid by Employer to Executive, including all
such cash amounts paid to Executive individually and as part of an employee or
executive compensation group  (or which
would have been paid but for an election by Executive to defer payment to a
later period) with respect to any fiscal year of Employer during the Term of
Employment prior to such date of termination.


 


4.9                               Change
in Control.   A “Change in
Control event” means any event that
may qualify as a “Change in Control” under Company’s 2003 Stock Incentive Plan,
as may be amended and in effect from time to time.


 


(a)                                  Termination pursuant to certain provisions prior to a Change in Control
event.  If the Term of
Employment has been terminated pursuant to Sections 4.2, 4.6 or 4.7 at any time
during the twelve month period prior to a Change in Control event, Executive or
the named beneficiary or other legal representative, as the case may be, shall
be entitled  to receive, in addition to
payments and benefits set forth in the 


 


12

















 


applicable Section, the
Severance Payment as set forth in Section 4.5.1(c) above subject to
the provisions of Section 4.11 (“Change in Control Payment”); provided, however,
that any sums previously paid to Executive’s named beneficiary or other legal
representative pursuant to Section 4.2(c) providing for a Lump Sum
Payment shall reduce the amount of the Change in Control  Payment. 
In any such case, the Change in Control Payment shall be paid on the
earliest date during the first taxable year of Executive following the taxable
year of Executive in which Executive’s employment terminates on which such
payment can be made in compliance with Section 409A of Code.


 


(b)                                 Termination pursuant to certain provisions following a Change in
Control event. (i) If, during the period beginning on the date
of the Change in Control event and ending on the date two (2) years after
a Change in Control event, Executive’s Term of Employment is terminated
pursuant to Section 4.2, Executive’s named beneficiary or other legal
representative, as the case may be, shall be entitled to receive, in addition to
payments and benefits set forth in Section 4.2, the Change in Control
Payment; provided, however,
that payment of the Change in Control Payment shall be in lieu of the Lump Sum
Payment.  In such case, the Change in
Control Payment will be paid immediately within thirty (30) days of the date of
death; (ii) If, during the period beginning on the date of the Change in
Control Event and ending on the date that is one (1) year after a Change
in Control Event, Executive either voluntarily terminates his employment
pursuant to Section 4.6, or retires pursuant to Section 4.7, then
Executive shall be entitled to receive the Change in Control Payment, such
Payment to be paid within thirty (30) days following the date Executive
employment terminates.  .


 


4.10                        Release.  In the event of termination of
employment for any reason, the payments and other benefits (if any) required to
be provided to Executive pursuant to this Section 4 (including those, if
any, required under this Section 4 to be paid pursuant to other sections
of this Agreement) will be in full and complete satisfaction of any and all
obligations owing to Executive pursuant to this Agreement and, to the fullest extent permitted by law, any other claims
Executive may have in respect of Executive’s employment by Employer. Such
amounts shall constitute liquidated damages with respect to any and all such
rights and claims and, upon Executive’s receipt of such amounts, Employer shall
be released and discharged from any and all liability to Executive in
connection with this Agreement or otherwise in connection with Executive’s
employment by Employer. Notwithstanding the foregoing, Executive shall retain
all rights (i) with respect to Employer’s continuing obligations to
indemnify the Executive as a former officer or director of Employer as set
forth in Section 6,  (ii) matters
covered by provisions of this Agreement that expressly survive the termination
of this Agreement,  (iii) rights to
which Executive is entitled by virtue of his 


 


13

















 


participation in the
employee benefit plans, policies and arrangements of Employer, and (iv) as
otherwise excluded by applicable law.


 


4.11                        Code Section 280G
Reduction.  Anything in this
Agreement or in any other agreement, contract, understanding, plan or program,
entered into or maintained by Employer to the contrary notwithstanding, in the
event it shall be determined that any payment or distribution by Employer to or
for the benefit of Executive, whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise
(collectively, the “Payments”), would be subject to the excise tax imposed by Section 4999
of the Code, and/or any successor provision or section thereto (such excise
tax, together with any interest or penalties incurred by Executive with respect
to such excise tax, collectively, the “Excise Tax”), and if the Payments less
the Excise Tax would be less than the amount of the Payments that would
otherwise be payable to Executive without imposition of the Excise Tax, then,
to the extent necessary to eliminate the imposition of the Excise Tax (and
taking into account any reduction in the Payments provided by reason of Section 280G
of the Code in any such other agreement, contract, understanding, plan or
program), the cash and non-cash payments and benefits payable to Executive
shall be reduced (with Executive being provided with the amount of each payment
and benefit as calculated by Employer and given ten (10) business days in
which to prioritize the order of reduction of each such payment or benefit);
but only if, by reason of any such reduction, the Payments with any such
reduction shall exceed the Payments less the Excise Tax without any such
reduction.  For purposes of this Section 4.11,
(i) no portion of the Payments, the receipt or enjoyment of which
Executive shall have effectively waived in writing prior to the date of
termination, shall be taken into account, (ii) no portion of the Payments
shall be taken into account that, in the opinion of tax counsel selected in
good faith by Employer, does not constitute a “parachute payment” within the
meaning of Section 280G(b)(2) of the Code, including without
limitation by reason of Section 280G(b)(4)(A) of the Code, (iii) any
payments and/or benefits under this Agreement or otherwise for services to be
rendered on or after the effective date of a Change in Control shall be reduced
only to the extent necessary so that such payments and/or benefits in their
entirety constitute reasonable compensation for services actually rendered
within the meaning of Section 280G(b)(4)(B) of the Code or are
otherwise not subject to disallowance as deductions, in the opinion of the tax
counsel referred in the immediately preceding clause (ii) of this
sentence, and (iv) the value of any non-cash payment or benefit or any
deferred payment or benefit included in the Payments shall be determined by
Employer’s independent auditors in accordance with the principles of Sections
280G(d)(3) and 280G(d)(4) of the Code and the applicable regulations
or proposed regulations under the Code. 
Except as otherwise provided in this Section 4.11, the foregoing
calculations and determinations shall be made in good faith by Employer and
shall be conclusive and binding upon the parties.  Employer shall 


 


14

















 


pay all costs and
expenses incurred in connection with any such calculations or determinations.


 


4.12                        Timing of
Payment; Section 409A.  All
Accrued Obligations payable under this Agreement shall be paid in cash in
single lump sum within fourteen (14) days following the date of termination (or
at such earlier date required by law).
The Additional Benefits shall be paid in accordance with the terms of the
applicable plan, program or arrangement. 
Except to the extent prohibited by applicable law or the terms of
this Agreement, all other payments to which Executive shall be entitled to
under this Section 4 shall be made within thirty (30) days following the
date of termination, subject to the following:


 


(a)                                  Payments
to Executive under this Section 4 shall be bifurcated into two portions,
consisting of a portion that does not constitute “nonqualified deferred
compensation” within the meaning of Section 409A of the Code and a portion
that does constitute nonqualified
deferred compensation. Payments hereunder shall first be made from the portion,
if any, that does not consist of nonqualified deferred compensation until it is
exhausted and then shall be made from the portion that does constitute
nonqualified deferred compensation. However, anything in this Agreement to the contrary notwithstanding, if at the
time of Executive’s termination of employment, Executive is considered a
“specified employee” as defined in Section 409A(a)(2)(B)(i) of the
Code, then to the extent required by Section 409A of the Code, no payments that constitute nonqualified
deferred compensation shall be payable prior to the date that is the earlier of
(i) six months and a day after Executive’s date of termination, or (ii) Executive’s
death (“Earliest Payment Date”).  Any
payments that are delayed pursuant to the preceding sentence shall be paid on
the Earliest Payment Date. The determination of whether, and the extent to
which, any of the payments to be made to Executive hereunder are nonqualified
deferred compensation shall be made after the application of all applicable
exclusions under Treas. Reg. § 1.409A-1(b)(9). Any payments that are intended
to qualify for the exclusion for separation pay due to involuntary separation
from service set forth in Treas. Reg. § 1.409A-1(b)(9)(iii) must be paid
no later than the last day of the second taxable year of Executive following
the taxable year of Executive in which the Date of Termination occurs.


 


(b)                                 The intent of the parties is that payments
and benefits under this Agreement comply with Section 409A and,
accordingly, to the maximum extent permitted, this Agreement shall be
interpreted to be in compliance therewith. The parties acknowledge and agree that the
interpretation of Section 409A of the Code and its application to the
terms of this Agreement is uncertain and may be subject to change as additional



 


15

















 


guidance and interpretations become available. Anything
to the contrary herein notwithstanding, all benefits or payments provided by
Employer to Executive that would be deemed to constitute “nonqualified deferred
compensation” within the meaning of Section 409A of the Code are intended
to comply with Section 409A of the Code. If, however, any such benefit or
payment is deemed to not comply with Section 409A of the Code, Employer
and Executive agree that this Agreement may be amended (and that any
such amendment may be retroactive to the extent permitted under Section 409A),
as reasonably requested by either party, and as may be necessary to fully
comply with Section 409A of the Code and all related rules and
regulations in order to preserve the payments and benefits provided hereunder
without additional cost to either party.


 


4.13                        No
Obligation to Mitigate; Set Off Under Certain Circumstances.  In the event of any termination of
Executive’s employment under this Section 4, Executive shall be under no
obligation to seek other employment or to mitigate damages and no payment
provided for in this Agreement shall be reduced by any compensation earned by
Executive as the result of employment by another employer, or from
self-employment, after the    termination
of his employment with Employer. 
Notwithstanding the foregoing, nothing herein shall be deemed to prevent
Employer from setting off against any amounts due to Executive under this
Agreement any amounts due from Executive to Employer as of the date of such
payment.


 


4.14                        Bank
Regulatory Limitations.  Any
payments made to Executive pursuant to this Agreement, or otherwise, are
subject to and conditioned upon their compliance with 12 U.S.C. §
1818(k) and any applicable regulations promulgated thereunder.  In addition, to the extent required by
applicable law, regulation, regulatory policy or other regulatory requirement,
the aggregate amount and/or value of the compensation paid as a result of any
termination of Executive’s employment with Employer, regardless of the reason
for any such termination of employment, shall not exceed the limit prescribed
by such applicable law, regulation, regulatory policy or other regulatory
requirement.


 


4.15  Option to Serve as Consultant.  During the Term of Employment and in lieu of
a termination under Sections 4.5, 4.6 or 4.7, the parties may mutually agree
that Executive’s position under Section 1 and his duties, as well as the
time and effort required, under Section 2 be modified and the compensation
set forth in Section 3 be adjusted as set forth in this Section 4.15
and, in such event, Executive shall continue in the employ of Employer under
the same terms and conditions, including but not limited to benefits under
sections 3.3 through 3.7, as is set forth in this Agreement except as
specifically modified by this Section 4.15.


 


(a) 
Position and Duties.  Executive shall serve as a consultant to 


 


16

















 


Employer and shall render such services of an
advisory or consultative nature as Employer may reasonably require of him from
time to time and he shall assist Employer in its relations with its employees
and customers, such that Employer shall have the benefit of Executive’s
experience and knowledge of Employer’s business and operations, his reputation
and contacts in the industry generally as well as Employers’ market area and
his general business experience. In the event that Executive was serving as a
director as referenced in Section 1, there shall be no affirmative
obligation on the part of Executive to serve or continue to serve as such and
service as a director shall be in accordance with the mutual agreement of
Executive and Employer.


 


(b) Time and Effort.  Executive shall perform such services at a
level of at least fifty percent (50%) of the services that Executive performed
over the 36 month period occurring immediately prior to the implementation of
this Section 4.15.


 


(c) Compensation.  Upon implementation of this Section 4.15,
Executive shall receive, in equal installments in accordance with the customary
payroll practices of Employer, compensation, in lieu of the compensation set
forth in sections 3.1 and 3.2, in an amount equal, on a per annum basis, to
fifty percent (50%) of Executive’s Highest Annual Compensation as determined as
of the day immediately prior to the implementation of this Section 4.15
and such amount shall constitute Executive’s Base Salary amount for all
purposes of this Agreement.


 


5. Confidentiality/Non-competition/Non-solicitation/Intellectual
Property.


 


5.1                   Confidentiality.  Executive shall not, during the Employment
Term or anytime thereafter, make use of or disclose any Confidential
Information to any person or entity (including, but not limited to any bank,
trust company, credit union, corporation, firm, unincorporated organization,
association, partnership, limited liability company, trust estate, joint
venture or other business organization or entity) (“Person”) for any reason or
purpose whatsoever other than in furtherance of Employer’s business.  The term “Confidential Information” shall
mean all confidential information of or relating to Employer and any Person
effectively controlling, effectively controlled by or effectively under common
control with Employer (“Affiliate”) including, without limitation, financial
information and data, business plans and information regarding prospects and
opportunities (such as, by way of example only, client and customer lists and
acquisition, disposition, expansion, product development and other strategic
plans), but does not include any information that is or becomes public knowledge
by means other than Executive’s breach or nonobservance of his obligations
described in this Section 5.1. 
Notwithstanding the foregoing, Executive may disclose such Confidential
Information as he may be legally required to do so on the advice of counsel in
connection with any legal 


 


17

















 


or regulatory
proceeding; provided, however, that Executive shall
provide Employer with prior written notice of any such required or potentially
required disclosure and shall cooperate with Employer and use his best efforts
under such circumstances to obtain appropriate confidential treatment of any
such Confidential Information that may be so required to be disclosed in
connection with any such legal or regulatory proceeding.  Executive’s obligation to refrain from
disclosing Confidential Information under this Section 5.1 shall continue
in effect in accordance with its terms following any termination of this
Agreement pursuant to Section 4 above.


 


5.2                   Non-competition.  Without prior written consent of the
Board of Directors of Employer, Executive agrees that he will not, at any time
during the Term of Employment and for the two-year period following the
Expiration of the Term of Employment for Non-Renewal as set forth in Section 4.1
or the termination of the Term of Employment for any reason as set forth above
in Sections 4.4 through 4.7, directly or indirectly, whether as owner, partner,
shareholder (other than the holder of 1% or less of the common stock of any
company the common stock of which is listed on a national stock exchange or
quoted on the Nasdaq Stock Market), or as consultant, agent, employee of any
other Person or otherwise, engage in competition (as to any service or product
provided by Employer or for which Employer had made substantial preparation to
enter into or offer prior to the termination of Executive’s employment) with
Employer or any of its Affiliates anywhere within a ten (10) mile radius
of any city or town in which Bank or any Affiliate has a branch or other office
(or to such lesser extent and for such lesser period as may be deemed
enforceable, it being the intention of the parties that this Section 5.2
shall be so enforced); provided, however,  that the restrictive covenant set forth
herein shall automatically terminate or expire upon a Change in Control event
and shall not be of any further force or effect whatsoever following said
Change in Control event.


 


5.3                               Non-solicitation.  Without prior written consent of the
Board of Directors of Employer, Executive agrees that he will not, at any time
during the two-year period following the Expiration of the Term of Employment
for Non-Renewal as set forth in Section 4.1 or the termination of the Term
of Employment for any reason as set forth above in Sections 4.4 through 4.7:


 


(a)                                  hire
or attempt to hire, or assist in hiring, any employees of Employer or any of
its Affiliates, or solicit, encourage or induce any such employee to terminate
his or her relationship with Employer or any such Affiliate; or


 


(b)                                 solicit,
encourage or induce any customer or client of Employer or any of its Affiliates
to terminate his or its relationship with Employer or any such Affiliate or to
do business with anyone other than Employer and its Affiliates.


 


18
















 


5.4                               Intellectual
Property.  Executive will, during
the period of his employment, disclose to Employer promptly and fully all
Intellectual Property (as defined below) made or conceived by Executive (either
solely or jointly with others) including but not limited to Intellectual
Property which relate to the business of Employer or result from work performed
by him for Employer. All Intellectual Property and all records related to
Intellectual Property, whether or not patentable, shall be and remain the sole and
exclusive property of Employer and Employer shall have the exclusive worldwide
and perpetual right to use, make, and sell products and/or services derived
therefrom.  Intellectual Property means
all copyrights, trademarks, trade names, trade secrets, proprietary
information, inventions, designs, developments, and ideas, and all know-how
related thereto. Executive hereby assigns and agrees to assign to Employer all
his rights to Intellectual Property and any patents, trademarks, or copyrights
which may be issued with respect to Intellectual Property.  Executive further acknowledges that all work
shall be work made for hire. During and after the Term of Employment, Executive
agrees to assist Employer, without charge to Employer but at its request and
expense, to obtain and retain rights in Intellectual Property, and will execute
all appropriate related documents at the request of Employer. Executive and
Employer agree that this Section 5.4 shall not apply to any Intellectual
Property for which no equipment, supplies, facilities, trade secret, or other
confidential information of Employer was used and which was developed entirely
on his own time, provided that it does not relate to the business of Employer
or and does not result from any work performed by him for Employer.


 


5.5                               Return
of Materials.  Upon the
termination of Executive’s employment, Executive will return to Employer all
Employer property, including all materials furnished to Executive during the
Term of Employment (including but not limited to keys, computers, automobiles,
electronic communication devices, files, electronic storage devices and
identification cards); provided, however, that Executive may retain copies of
materials relating to his compensation of benefits.  In addition, upon termination, Executive will
provide Employer with all passwords and similar information which are
reasonably necessary for Employer to access materials on which Executive worked
or to otherwise continue in its business.


 


5.6                               Injunctive
Relief.  Executive acknowledges
and agrees that the protections of Employer set forth in this Section 5
are fair and reasonable and are necessary for Employer to protect its
legitimate business interests, including its Confidential Information and
business relationships, and that Employer will have no adequate remedy at law,
and would be irreparably harmed, if Executive breaches or threatens to breach
any of the provisions of this Section 5. 
Executive agrees that Employer shall be entitled to seek equitable
and/or injunctive relief to prevent any breach of threatened breach of this Section 5,
and to specific performance of each of the terms of this Section 5 


 


19

















 


in addition to any other
legal or equitable remedies that Employer may have, without posting a
bond.  Executive further agrees that he
shall not, in any equity proceeding relating to the enforcement of the terms of
this Section 5, raise the defense that Employer has an adequate remedy at
law.


 


5.7                               Claw-back.   To
the fullest extent permitted by law, in the event that Executive breaches any
of the provisions of Section 5.1, 5.2 or 5.3:


 


(a)                                  Employer shall be entitled to recoup payments
made to Executive pursuant to Section 4 hereof, provided, however, that,
in the event of a breach of Section 5.1, such recoupment shall be limited
to the reasonable damages incurred by Employer as a result of such breach and,
in the event of a breach of Section 5.2 or Section 5.3, such
recoupment shall be equal to the total payments made to Executive pursuant to Section 4
multiplied by a fraction, the numerator of which is the number of months
remaining from the date of such breach to the second anniversary of the Term of
Employment or Expiration of the Term of Employment for Non-Renewal, as the case
may be, and the denominator of which is twenty-four (24) months; and


 


(b)                                 to the extent that any other benefits are
being provided to Executive pursuant to Section 4, such will cease
immediately, and Executive will not be entitled to any further compensation and
benefits from Employer pursuant to Section 4.


 


5.8                               Special
Severability.  The terms and
provisions of this Section 5 are intended to be separate and divisible
provisions and if, for any reason, any one or more of them is held to be
invalid or unenforceable, neither the validity nor the enforceability of any
other provision of this Agreement shall thereby be affected.


 


6.                                      Indemnification.  Executive (and his heirs, executors and
administrators) shall be indemnified and held harmless by Employer to the
fullest extent permitted by applicable law, regulation, regulatory policy or
other regulatory requirement, against all expenses, liabilities and losses
(including without limitation, all reasonable attorneys’ fees and all
judgments, fines, excise taxes or penalties and amounts paid or to be paid in
settlement) incurred or suffered by Executive as a consequence of Executive
being or having been made a party to, or being or having been involved in, any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that Executive
is or was a trustee, director or officer of Employer or is or was serving at
the request of Employer as a trustee, director or officer of the Employer of is
or was serving at the request of Employer as a trustee, director or officer of
another corporation or other entity and such indemnification shall continue
after Executive shall cease to be an officer, director or trustee.  The right to indemnification conferred hereby
shall be a contract right and shall also include, to the extent permitted by
applicable law, regulation, regulatory policy or other regulatory requirement,
the right to be 


 


20

















 


paid by Employer the
expenses incurred in defending any such proceeding in advance of the final
disposition upon receipt by Employer of an undertaking by or on behalf of
Executive to repay such amount or a portion thereof, if it shall ultimately be
determined that Executive is not entitled to be indemnified by Employer
pursuant hereto or as otherwise authorized by law, regulation, regulatory
policy or other regulatory requirement, but such repayment by Executive shall
only be in an amount ultimately determined to exceed the amount to which
Executive was entitled to be indemnified. 
Employer’s acceptance of any such undertaking by or on behalf of
Executive may not be conditioned upon any evidence or demonstration by or on
behalf of Executive of any financial capacity to make any such repayment at the
time such undertaking is delivered. The provisions of this Section 6 shall
survive any termination of this Agreement.


 


7.                                      Notices.  Any notice given hereunder shall be in
writing and shall be deemed given when delivered in-hand to the other party, by
facsimile transmission, by overnight courier, or by registered or certified
mail (return receipt requested, postage prepaid) addressed to the appropriate
party at the address first set forth above, or at such other address as the
party shall designate from time to time in a notice.


 


8.                                      Disputes. Any dispute, claim or
controversy arising out of or relating to this Agreement or the breach,
termination, enforcement, interpretation or validity thereof hereof (other than an action brought by Employer
for injunctive or other equitable relief in the enforcement of Employer’s
rights under Section 5 above, in which case such action may be brought in
any court of competent jurisdiction), including the determination of the
scope or applicability of this Agreement to arbitrate, shall be determined by
arbitration in Boston, Massachusetts, before three neutral arbitrators (one of
whom shall be appointed by Employer, one by Executive and the third by the
first two arbitrators).  The arbitration
shall be administered by JAMS pursuant to its Streamlined Arbitration Rules and
Procedures. Judgment on the Award may be entered in any court having
jurisdiction. This clause shall not preclude parties from seeking provisional
remedies in aid of arbitration from a court of appropriate jurisdiction.  In the event that it shall be necessary or
desirable for Executive to retain legal counsel and/or incur other costs and
expenses in connection with the enforcement of any or all of Executive’s rights
under this Agreement, Employer shall pay (or Executive shall be entitled to
recover from Employer, as the case may be) Executive’s reasonable attorneys’
fees and other reasonable costs and expenses in connection with the enforcement
of said rights (including the enforcement of any arbitration award in court)
regardless of the final outcome, unless and to the extent that the arbitrators
shall determine that Executive has not acted in good faith or presented a bona fide claim or dispute or that under the circumstances
recovery by Executive of all or part of any such fees and costs and expenses
would be inequitable or otherwise unjust.


 


21

















 


The parties agree that any and
all disputes, claims or controversies arising out of or relating to this
Agreement shall first be submitted to JAMS, or its successor, for mediation,
and if the matter is not resolved through mediation, then it shall be submitted
to JAMS, or its successor, for final and binding arbitration pursuant to the
arbitration clause set forth above. Either party may commence mediation by
providing to JAMS and the other party a written request for mediation, setting
forth the subject of the dispute and the relief requested. The parties will
cooperate with JAMS and with one another in selecting a mediator from JAMS
panel of neutrals, and in scheduling the mediation proceedings. The parties
covenant that they will participate in the mediation in good faith. Employer
shall pay (or Executive shall be entitled to recover from Employer, as the case
may be) Executive’s reasonable attorneys’ fees and other reasonable costs of
such mediation.  All offers, promises,
conduct and statements, whether oral or written, made in the course of the
mediation by any of the parties, their agents, employees, experts and
attorneys, and by the mediator or any JAMS employees, are confidential,
privileged and inadmissible for any purpose, including impeachment, in any
arbitration or other proceeding involving the parties, provided that evidence
that is otherwise admissible or discoverable shall not be rendered inadmissible
or non-discoverable as a result of its use in the mediation. Either party may
initiate arbitration with respect to the matters submitted to mediation by
filing a written demand for arbitration at any time following the initial
mediation session or 45 days after the date of filing the written request for
mediation, whichever occurs first. The mediation may continue after the
commencement of arbitration if the parties so desire. Unless otherwise agreed
by the parties, the mediator shall be disqualified from serving as arbitrator
in the case. The provisions of this Clause may be enforced by any Court of
competent jurisdiction, and the party seeking enforcement shall be entitled to
an award of all costs, fees and expenses, including attorneys’ fees, to be paid
by the party against whom enforcement is ordered.


 


In the event that within thirty (30) calendar days
after the date that Executive’s Term of Employment has been terminated by
Employer for Cause or by Executive for Good Reason, Executive (in the case of
termination for Cause), or Employer (in the case of termination for Good
Reason), notifies the other in writing that a dispute exists concerning the
termination of employment either for Cause or for Good Reason, as the case may
be (“Notice of Dispute”),


 


(1)                Executive
shall be entitled, to the extent not prohibited by applicable law, regulation,
regulatory policy or other regulatory requirement, to be paid his Base Salary
pursuant to Section 3.1 and to continue to receive all other benefits set
forth in Section 3 until the earliest to occur of the following: (i) the
expiration of the then current Term of Employment, or (ii) the resolution,
pursuant to the provisions of Section 8, of such dispute; and


 


(2)                there
shall be no reduction whatsoever of any amounts 


 


22

















 


subsequently paid
to Executive upon resolution of such dispute as a result of, or in respect to,
such interim payments or coverage;


 


provided, however,
that the Notice of Dispute is given in good faith, sets forth a bona fide claim or dispute and Executive pursues the
resolution of such dispute with reasonable diligence.  The Notice of Dispute hereunder shall in all
circumstances constitute (a) a Notice of Non-Renewal under Section 1
for purposes of determining the expiration of the then current Term of
Employment, and (b) a request for mediation and, therefore, a copy of such
Notice of Dispute shall be provided to JAMS as set forth above.


 


9.                                      Binding Effect; Successors.  This Agreement shall inure to the benefit of
and be binding upon Employer, its successors and assigns, and Executive and his
heirs, legal or personal representatives, but shall not inure to the benefit of
or be enforceable by any third party except as otherwise expressly provided
herein.  Except as otherwise expressly
provided herein, Employer and Executive agree on behalf of themselves and of
any other person or persons claiming any benefits by virtue of this Agreement,
that this Agreement and the rights, interests and benefits under it shall not
be assigned, transferred, pledged, or hypothecated in any way by Employer or
Executive or by any other person claiming under Employer or Executive by virtue
hereof; provided, however, that an assignment may be made to the extent that
the other party has consented to same in writing.


 


9.1                               Executive.  This Agreement is personal to Executive and, without the
prior written consent of Employer, shall not be assignable by Executive, except
that Executive’s rights to receive any compensation or benefits under this
Agreement may be transferred or disposed of pursuant to testamentary
disposition, intestate succession or pursuant to a qualified domestic relations
order.  In the event of Executive’s death
prior to the completion by Employer of all payments due to Executive under this
Agreement, Employer shall continue to make such payments to Executive’s
beneficiary(ies) as designated in writing by Executive to Employer prior to his
death (or to his estate, if he fails to make such designation).


 


9.2                               Employer. Both Company and Bank shall
require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of its businesses
and/or assets to assume expressly and agree to perform this Agreement in the
same manner and to the same extent as if no sucession had taken place.  Failure of either Company or Bank to obtain
such assumption and agreement prior to the effectiveness of any such succession
shall be a breach of this Agreement and shall entitle Executive to compensation
in the same amount and on the same terms as he would be entitled to hereunder
if he terminated this Agreement for Good Reason following a Change in Control,
except that for purposes of implementing the foregoing, the date on which any
such succession becomes effective shall be deemed to be the 


 


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date
of termination.  As used in this
Agreement, “Company,” “Bank” and “Employer” shall mean Company, Bank and
Employer as hereinbefore defined and any sucessor to the business and/or assets
of either Company or Bank as aforesaid which successor assumes and agrees to
perform this Agreement by operation of law or otherwise.


 


10.                               Miscellaneous.


 


10.1                        Governing Law.  This Agreement is made and delivered in, and
shall be construed in accordance with the substantive laws of, the Commonwealth
of Massachusetts without regard to conflict of law principles.


 


10.2                        Amendments; Waiver.  No amendment, waiver or modification of this
Agreement shall be valid unless the same shall be in writing and signed by the
party sought to be charged therewith; provided, however, that no amendment that will
result in a violation of Section 409A of the Code, or any other provision
of applicable law, may be made to this Agreement and any such amendment shall
be void ab initio. Failure to
insist in any one or more instances on strict compliance with the terms of this
Agreement shall not be deemed a waiver. Waiver of a breach of any provision of
this Agreement shall not be construed as a waiver of any subsequent breach.


 


10.3                        Entire Agreement. The parties acknowledge and
agree that they are not relying on any representations, oral or written, other
than those expressly contained herein. 
This Agreement supersedes all proposals, oral or written, all
negotiations, conversations or discussions between the parties and all course
of dealing. All prior understandings and agreements between the parties are
hereby merged in this Agreement, which alone is the complete and exclusive
statement of their understanding.


 


10.4                        Withholdings; Reporting.  All payments to be made to Executive by
Employer shall be subject to withholding of such amounts, if any, relating to
tax and other payroll deductions as Employer may reasonably determine it should
withhold pursuant to any applicable law and regulation. Employer may withhold
from any amounts payable under this Agreement such taxes as shall be required
to be withehld pursuant to any applicable law or regulation. Executive
acknowledges that Employer may be required to report amounts deferred by or for
Executive under nonqualified deferred compensation plans on forms W-2 and
agrees that Employer shall comply with all such requirements and Executive
agrees to pay and be solely responsible for all taxes, interest and penalties.


 


10.5                        Enforceability.  If any portion or provision of this Agreement
shall to any extent to be declared illegal or uneforceable by a court of
competent jurisdiction, then the remainder of this Agreement or the application
of such portion or provision in circumstances other than those as to which it
is so declared illegal or uneforceable, shall not be affected thereby, and each
portion 


 


24

















 


and
provision of this Agreement shall be valid and enforceable to the fullest
extent permitted by law.


 


10.6                        Captions.  Paragraph headings are for convenience of
reference only and are not intended to create substantive rights or obligations.


 


10.7                        Survivorship.  The respective rights and oblitations of the
parties to this Agreement including, without limitation, any of their
respective rights and obligations under Section 6 of this Agreement, shall
survive any termination of this Agreement or any termination of Executive’s
employment hereunder for any reason to the extent necessary to accomplish the
intended preservation of such rights and obligations.


 


10.8                        Construction.  The parties acknowledge that they each
participated in drafting this Agreement, and there shall be no presumption
against any party on the ground that such party was responsible for preparing
this Agreement or any part hereof.


 


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IN WITNESS WHEREOF,
this Agreement has been duly executed by the undersigned as of the day and year
first above written.


 


	
  ATTEST:

  	
   

  	
  ENTERPRISE BANCORP, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ Tanya A. Hubanks

  	
   

  	
  By

  	
  /s/ James F. Conway, III

  
	
   

  	
   

  	
  James F. Conway, III

  
	
   

  	
   

  	
  Director, Chairman of Compensation

  
	
   

  	
   

  	
  Committee

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ATTEST:

  	
   

  	
  ENTERPRISE BANK AND TRUST

  COMPANY

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ Tanya A. Hubanks

  	
   

  	
  By

  	
     /s/ James F. Conway, III

  
	
   

  	
   

  	
  James F. Conway, III

  
	
   

  	
   

  	
  Director, Chairman of Compensation

  
	
   

  	
   

  	
  Committee

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  WITNESS:

  	
   

  	
  EXECUTIVE

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ Tanya A. Hubanks

  	
   

  	
  /s/ John P. Clancy, Jr.

  
	
   

  	
   

  	
  John P. Clancy, Jr.

  
					



 


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