Enterprise Bank 2019 Variable Compensation Incentive Plan

The 2019 Variable Compensation Incentive Plan (the Plan) incents and rewards for both Bank and individual performance.

Regular team members who do not participate in an individual sales incentive plan or an individual commission plan are eligible to participate in this plan. Temporary and co-operative team members are ineligible to participate in this plan. Other than as described elsewhere in this plan, you must be employed through the last business day of the plan year to receive a payout. If your hire date is after January 1 of the current plan year, you will be eligible for a pro-rata payout, based on wages earned during the plan year.

You will have a target variable compensation opportunity (target percentage), which is a percentage of your regular earnings (base salary) earned in the current plan year.

You will be assigned to a variable compensation incentive group based upon your position and role. The attached addendum outlines your specific performance factor(s).

The Bank must attain a level of 0.5 in Net Income performance factor (the “threshold”) in the current plan year for a payout to be made. If the threshold is achieved, the variable compensation incentive payouts will be determined by the performance of each performance factor as shown on the addendum. The maximum incentive opportunity to be paid under this plan is 150% of target.

An extraordinary event, such as a windfall, composite federal or state compliance, Community Reinvestment Act (CRA) or safety and soundness rating below satisfactory, or another unusual event, may either positively or negatively impact the Bank’s financial reports. The Compensation Committee will have discretion whether the extraordinary event will impact the payout under the Plan.

The performance period is January 1 through December 31 of the current plan year. If it is determined that participants will receive a payout under the Plan, payouts will be received on or before March 15, following the plan year.

If a participant retires after the age of 62 and has been employed for at least three months in the current plan year, the participant is eligible to receive a pro-rata payout upon retirement. If a participant passes away or employment ends as result of disability during the plan year, the participant or the participant’s beneficiary is eligible to receive a pro-rata payout. Payouts will be based upon the participant’s wages earned in the current plan year, the participant’s performance, and management’s estimate of year-end results at the participant’s employment end date.

If the Bank’s reported financial or operating results are determined to be subject to material negative restatement due to material noncompliance with any financial reporting requirement under the securities laws, fraud, or misconduct (other than a restatement caused by a change in applicable accounting rules or interpretations), the Compensation Committee may require recoupment of full or partial payout made to participants with an officer status of Senior Vice President (SVP) or above.

Annualized salaries and benefits expense multiplier for 2019:

*Net income results are determined after sales incentive and variable compensation incentives are calculated. For example, if net income reaches 1.25 or $33.857M this creates approximately $488 thousand more in incentive compensation expense after tax reducing net income below 1.25.  As such level 1.25 would be met only if net income were at a level that after the additional incentive compensation expense net income exceeded the $33.857M.