SEVERANCE AGREEMENT

Exhibit 10.35

SEVERANCE AGREEMENT

THIS SEVERANCE AGREEMENT (the "Agreement") made as of the 4th day of

December, 2002 (the "Commencement Date") between THE TOWN BANK OF WESTFIELD, a

New Jersey banking corporation, with offices at 520 South Avenue, Westfield, New

Jersey 07090 ("TBW" or the "Company"), and NICHOLAS A. FRUNGILLO, JR., residing

at 1571 Rising Way, Mountainside, New Jersey 07092 (the "Employee").

WHEREAS, the Employee has been a loyal and long-term employee of TBW for

many years; and

WHEREAS, TBW wishes to provide the Employee with the comfort of knowing

that if the Employee loses his or her position with TBW, or any related

entities, as a result of any involuntary termination or upon a "change in

control", the Employee will be entitled to receive a severance benefit;

NOW, THEREFORE, the parties agree, intending to be legally bound, as

follows:

1. Definitions. For purposes of this Agreement, the following words and

phrases shall be defined as follows:

a. "Base Compensation" shall mean the base salary which is payable on a

regular basis to the Employee in effect immediately prior to a

termination without "cause", in the case of a Basic Severance

Benefit payable under Section 4(a) hereof, or immediately prior to a

Change in Control in the case of a Change in Control Severance

Benefit payable under Section 4(b) hereof, including the last full

calendar year's bonus and fringe benefits.

b. "Cause" shall include, but not be limited to, any material false

statement that was intentionally or negligently made, contained in

any corporate records; the commission by the Employee of any crime

or fraud against the Company or its property, or any crime involving

moral turpitude or reasonably likely to bring discredit upon the

Company; and any violation of the Company's operating policies.

c. "Change in Control" shall mean (i) the acquisition of ownership of

stock of the Company, by any person (including, without limitation,

a corporation, trust, partnership, joint venture, limited liability

company (a "Person") or by any group of Persons), whether directly,

indirectly, beneficially or of record, which acquisition, together

with stock held by such person or group, represents more than 50% of

the total voting power of all outstanding stock of the Company

(provided that no Change in Control shall occur under this

subparagraph (i) if the Person acquiring any additional stock

already possessed more than 50% of the total fair market voting

power of the stock of the Company); (ii) any merger or consolidation

of the Company which the stockholders of the Company before such

merger or consolidation do not, as a result of the merger or

consolidation, own at least 50% of the merged or consolidated

entity; or (iii) any nomination and election of 50% or more of all

members of the Board of Directors of the Company that occurs at any

three consecutive meetings of the shareholders, whose election is

without the recommendation of the Board. "Change in Control" shall

not include the acquisition of the Company's stock by any Company

employee benefit plans.

d. "Code" shall mean the Internal Revenue Code of 1986, as amended from

time to time.

e. "Termination Date" shall mean the last day the Employee performs any

services for TBW, or any related entity or successor entity, and is

paid wages as an employee, exclusive of vacation and severance

payments, and excluding any leave of absence periods.

2. Term. The term of the Agreement shall commence on the Commencement Date,

and shall continue on an uninterrupted basis until and including December

4, 2004; or until terminated with the mutual consent of the Employee and

TBW; or upon the voluntary termination of the Employee's employment with

TBW or any successor entity. Upon the Employee's Termination Date, no

additional services shall be required of the Employee (unless provided

otherwise under any consulting agreement), and any payments due for the

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performance of any services, and reimbursement for any expenses, shall be

made within a period of 15 days from the Termination Date.

3. Condition for Severance Benefits. In order to be entitled to payment of

any severance benefits, the Employee agrees to execute a General Release

that shall fully release and forever discharge the company and any and all

related companies, form all claims the Employee may have based on

employment with the Company. These claims shall include, but are not

limited to, claims arising under the Constitution of the United States, a

release of any rights or claims the Employee may have under the Age

Discrimination in Employment Act of 1967; Title VII of the Civil Right Act

of 1964; the Civil Rights Act of 1966; the Equal Pay Act; or any other

federal, state or local laws or regulations prohibiting employment

discrimination; the Employee Retirement Income Security Act of 1974;

Executive Orders 11246 and 11141; the Constitution of the State of New

Jersey or any other states in which the Employee resides or works; any New

Jersey or other state laws against discrimination; any claims of breach of

public policy of the State of New Jersey or other state, negligence,

breach of contract, wrongful discharge, constructive discharge, breach of

an implied covenant of good faith and fair dealings; any express or

implied contracts with the Company or any related companies; any federal

or state common law and any federal, state or local statutes, ordinances

and regulations.

The General Release shall be in a format prepared by the Company, which

shall be consistent with the above provisions and shall comply with the

Older Workers Benefit Protection Act of 1990 ("OWBPA"), including a 21-day

period to review the General Release, and a 7-day revocation period (or

any other periods required under any future laws). Any severance payments

shall be the Employee's exclusive right and remedy against the Company.

4. Severance Benefits. The Employee's employment may be terminated by the

Employee or by the Company or any related entity or successor entity

"without "Cause", notice or liability at any time. Upon the occurrence of

any termination of employment, the following severance benefits shall be

provided, depending upon the specific circumstances of any termination:

a. Basic Severance Benefit. If the Company, or any related entity or

successor entity terminates the EmpIoyee's employment with the

Company for any reason, without "Cause", the Employee shall be

entitled to a Basic Severance Benefit equal to payment of the

Employee's Base Compensation for a period of six (6) months.

b. Change in Control Severance Benefit. If the Company, or any related

entity or successor entity terminates the Employee's employment in

anticipation of a reorganization or a "Change in Control", or if the

Company, or any related entity or any successor entity terminates

the Employee's employment following a Change in Control for any

other reasons without "Cause", or if the Employee's employment is

"constructively terminated" as defined in Section 8, the Employee

shall receive a payment equal to the Employee's Base Compensation

for a period of six (6) months.

Both the Basic Severance Benefit and a Change in Control Severance Benefit

shall solely be paid to the Employee in a single lump sum payment. In

either case, the applicable severance benefit shall not be paid until

eight days after receipt of an executed copy of a General Release by the

Company, as provided in Section 3. Severance benefit payments shall also

be reduced to the extent of any advance payments, for any excess expense

reimbursements, and for any amounts owed to the Company by the Employee

(other than normal personal residence, home equity and similar loans).

In the event of the death of the Employee after the commencement of

entitlement to any severance benefit payable under Section 4, all benefits

shall be paid in a lump sum to the Employee's spouse, or if no spouse

exists, to the Employee's estate.

Notwithstanding any interpretation to the contrary, in no event shall the

Employee be entitled to both the Basic Severance Benefit and the Change in

Control Severance Benefit.

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5. Benefits. Upon the occurrence of any termination of employment by the

Company, or any related entity or successor entity without "Cause", or

upon the occurrence of a "constructive termination" in accordance with

Section 8, the Employee shall be entitled to the following general

benefits.

a. All Base Compensation through the Termination Date shall be paid in

accordance with the Company's normal payroll procedures.

b. All accrued vacation pay shall be included in the Employee's final

paycheck.

c. The Employee shall be entitled to elect to r