(e) On March 25, 2009, Somerset Hills Bancorp (the "Company") entered into a Waiver Agreement with the Company's President, Chief Executive Officer, and Chief Operating Officer Stewart E. McClure, Jr., waiving certain provisions of the Company's employment agreement with Mr. McClure. In January, 2009, the Company participated in the U.S. Treasury's Capital Purchase Program ("CPP") and received an investment of $7.4 million. The employment agreement complied with all of the terms of the CPP then in effect. However, the terms of the CPP were revised by the American Recovery and Reinvestment Act of 2009, adopted on February 17 (the "ARRA"). The ARRA prohibits institutions participating in the CPP from granting certain forms of compensation to senior executive officers, including Mr. McClure. In order to comply with this restriction, Mr. McClure waived his right to severance and a payment to his estate in the event of his death under his employment agreement.

(d) Exhibits. The following is filed as an exhibit to this Current Report on Form 8-K:

  Exhibit
  Number    Description of Exhibit

   10.1      Waiver Agreement, executed by Stewart E. McClure, Jr.