8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

__________________________________

FORM 8-K

CURRENT REPORT PURSUANT

TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

March 19, 2009

Date of Report (Date of earliest event reported)

__________________________________

UNITY BANCORP, INC.

(Exact Name of Registrant as Specified in its Charter)

New Jersey

(State or Other Jurisdiction of Incorporation)

   1-12431

(Commission File Number)

22-3282551

(IRS Employer Identification No.)

64 Old Highway 22

Clinton, NJ 08809

(Address of Principal Executive Office)

(908) 730-7630

(Registrant's Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 o Soliciting material pursuant to Rule 14a12 under the Exchange Act (17 CFR 240.14a-12)

 o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) On March 19, 2009, Unity Bancorp, Inc. (“Unity”), entered into Waiver Agreements with each of James A. Hughes, Alan J. Bedner, Michael F. Downes and John J. Kauchak, waiving certain provisions of Unity’s employment agreement with Mr. Hughes and its retention agreements with the other executives.  In December 2008, Unity participated in the U.S. Treasury’s Capital Purchase Program (“CPP”) and received an investment of $20.6 million. The employment and retention agreements complied with all of the terms of the CPP then in effect. However, the terms of the CPP were revised by the American Reinvestment and Recovery Act of 2009, adopted on February 17, 2009 (the “ARRA”). The ARRA prohibits the payment of severance to the senior executive officers of an institution participating in the CPP. In order to comply with this restriction, each of Messrs. Hughes, Bedner, Downes and Kauchak have waived their respective rights to severance under their respective agreements.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

Exhibit Description of Exhibit

10.1	Waiver Agreement executed by James A. Hughes
10.2	Form of Waiver Agreement related to Retention Agreements with each of Alan J. Bedner, Michael F. Downes and John J. Kauchak

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

	UNITY BANCORP, INC.
Date: March 19, 2009	By:	/s/
		Alan J. Bedner, Jr. EVP and Chief Financial Officer

EX-10.1

  
    exh10_1.htm




    
    

EX-10.2

Exhibit 10.2

FORM OF WAIVER AGREEMENT

(RETENTION AGREEMENTS)

 WAIVER AGREEMENT (this "Waiver"), made as of March 19, 2009, by and between Unity Bancorp, Inc., a New Jersey corporation with an address at 64 Old Highway 22, Clinton, NJ 08809 (the “Company”), Unity Bank, a New Jersey state commercial bank with its principal place of business located at 64 Old Highway 22, Clinton, NJ 08809 (the “Bank”) and __________, (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 Retention Agreement, made as of March 19, 2007, (and as may hereafter be further amended, modified, supplemented, extended, renewed, restated or replaced, the "Retention 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 2008 (“EESA”), the United States 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 (the “ARRA”), which, among other things, imposed certain limitations upon the compensation of executive officers of companies which participated in the CPP;

WHEREAS, the Retention Agreement does not comply with the requirements of the ARRA, in that it provides for certain severance payments to the Executive; and

WHEREAS, the Executive is willing to waive such portions of the Retention 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 Retention Agreement that  would render the Employer in violation of the Section 111 of the EESA, as amended by the ARRA, and the regulations as may be promulgated thereunder from time to time, including, but not limited to:

a.           Section (b) of Article 1 of the Retention Agreement with respect to the Executive’s rights to receive a payment equal to twelve (12) months of the Executive’s then current Base Salary in the event of the Executive’s Termination Without Cause;

b.           Section (c) of Article 1 of the Retention Agreement with respect to the Executive’s right to receive a payment equal to twelve (12) months of the Executive’s then current Base Salary upon the Executive’s Resignation With Cause;

c.           Section (a & d) of Article 2 of the Retention Agreement with respect to the Executive’s right to receive a payment equal to the greater of: (i) twenty-four (24) months of the Executive's Base Salary; or (ii) twenty-four (24) 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 upon him pursuant to the Retention 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.

3           Entire Agreement; Binding Affect; Employment Agreement to Remain in Effect.  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:  David D. Dallas

Title:     Chairman

Unity Bank

By:  ________________________

Name:  James A. Hughes

Title:     President/CEO

____________________________