WAIVER AGREEMENT
Exhibit
10.1
WAIVER
AGREEMENT (this "Waiver"), made as of March 19, 2009, by and between Unity
Bancorp, Inc., a New Jersey corporation with an address at 00 Xxx Xxxxxxx 00,
Xxxxxxx, XX 00000 (the “Company”), Unity Bank, a New Jersey state commercial
bank with its principal place of business located at 00 Xxx Xxxxxxx 00, Xxxxxxx,
XX 00000 (the “Bank”) and Xxxxx X. Xxxxxx, an individual residing at 0 Xxxxx
Xxxx, Xxxxxxx, XX 00000 (the "Executive"). The Company and the Bank
shall be referred to herein collectively as the “Employer”.
WITNESSETH:
WHEREAS, the
Employer and the Executive have entered into that certain Employment Agreement,
made as of March 23, 2004 and amended pursuant to the First Amendment to the
Employment Agreement made as of May 26, 2005 (and as may hereafter be further
amended, modified, supplemented, extended, renewed, restated or replaced, the
"Employment Agreement"), which governs the terms and conditions of the
Executive’s employment with the Employer;
WHEREAS, as
part of the Emergency Economic Stabilization Act of 0000 (“XXXX”), xxx Xxxxxx
Xxxxxx Treasury (the “Treasury”) adopted a program known as the Capital Purchase
Program (“CPP”) pursuant to which the Treasury will invest in United States
insured depository institutions;
WHEREAS, the
Company received an investment of $20,649,000 from the Treasury pursuant to the
CPP on December 5, 2008;
WHEREAS, the
terms of the CPP were revised by the American Recovery and Reinvestment Act of
2009 (“ARRA”), which, among other things, imposed certain limitations upon the
compensation of executive officers of companies which participated in the
CPP;
WHEREAS, the
Employment Agreement does not comply with the requirements of ARRA, in that it
provides for certain severance payments to the Executive; and
WHEREAS, the
Executive is willing to waive such portions of the Employment Agreement which do
not comply with the ARRA subject to the terms and conditions contained
herein.
NOW THEREFORE,
in consideration of the foregoing, and the respective agreements and covenants
contained herein, the parties hereto agree as follows:
1. Waiver.
Subject to
the terms and conditions hereof, the Executive hereby agrees to waive all
provisions of the Employment Agreement which would render the Employer in
violation of the Section 111 of the EESA, as amended by the ARRA, and the
regulations may be promulgated thereunder from time to time, including, but not
limited to:
a. Section
(b) of Article 5 of the Employment Agreement with respect to the Executive’s
right to receive payment equal to eighteen (18) months of the Executive’s then
current Base Salary in the event of the Executive’s Termination Without
Cause;
b. Section
(c) of Article 5 of the Employment Agreement with respect to Executive’s right
to receive payment equal to eighteen (18) months of the Executive’s then current
Base Salary upon the Executive’s Resignation With Cause;
c. Article
6 with respect to the Executive’s right to receive payment equal to the greater
of: (i) thirty-six (36) months of the Executive's Base Salary; or (ii)
thirty-six (36) months of the Executive's then current Base Salary plus any cash
bonus received by the Executive for the Employer's preceding fiscal year, in the
event of a Change in Control or Significant Acquisition;
provided, however, that
the foregoing waiver will be of no
further force or effect, and the Executive will be
entitled to exercise all of his
rights
and remedies under the Employment
Agreement, and applicable law, automatically upon such time as the
Company is no longer prohibited from making the payments described above under
the EESA and regulations thereunder, whether because the Company’s obligation to
the Treasury arising from the Company’s participation in the CPP shall be
satisfied or excused, the EESA shall be further amended to eliminate the
prohibition on severance or otherwise.
2. Further Limitations of
Waiver.
This Waiver
by the Executive of the benefits conferred to him pursuant to the Employment
Agreement shall be construed only to the minimum extent necessary so that the
Employer shall be in compliance with the Section 111 of the EESA, the ARRA and
the regulations as may be promulgated from time to time thereunder
(collectively, the “Acts”), and shall not be construed to grant to the Employer
additional benefits beyond what is minimally required to comply with the
Acts.
This Waiver
constitutes the entire and final agreement among the parties with respect to the
subject matter hereof and there are no agreements, understandings, warranties or
representations among the parties as to such subject matter except as set forth
herein. This Waiver will inure to the benefit and bind the parties
hereto and the respective heirs, administrators, executors, representatives,
successors and permitted assigns of the parties hereto. Except as specifically
provided for hereunder, the Employment Agreement shall remain in full force and
effect, shall not be modified or otherwise revised by this Waiver
Agreement.
4. Defined
Terms.
Capitalized
terms used herein and not otherwise defined shall have the meanings ascribed to
them in the Employment Agreement.
5. Governing
Law.
This Waiver
is executed and delivered in the State of New Jersey and it is the desire and
intention of the parties that it be in all respects interpreted according to the
laws of the State of New Jersey, without giving effect to choice of law
provisions thereof.
6. Counterparts.
This Waiver
may be executed in counterparts, each of which will be deemed an original
document, but all of which will constitute a single document.
IN WITNESS WHEREOF, the
Company, the Bank and the Executive legally bound, have executed this Waiver
Agreement as of the date first noted above.
Unity
Bancorp, Inc.
By: ________________________
Name: Xxxxx X.
Dallas
Title: Chairman
Unity
Bank
By: ________________________
Name: Xxxx X.
Xxxxxx
Title: EVP/CFO
____________________________
Xxxxx X.
Xxxxxx
