Edgar Filing: Community Partners Bancorp

b47101def14a.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934

(Amendment No. )

Filed by the Registrant x

Filed by a Party other than the Registrant o

Check the appropriate box:

o Preliminary Proxy Statement

o Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

x Definitive Proxy Statement

o Definitive Additional Materials

o Soliciting Material Pursuant to §240.14a-12

Community Partners Bancorp

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

x No fee required.

oFee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

1.	Title of each class of securities to which transaction applies:

2.	Aggregate number of securities to which transaction applies:

3.	Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined):

4.	Proposed maximum aggregate value of transaction:

5.	Total fee paid:

¨	Fee paid previously with preliminary materials.

¨	Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

1.	Amount Previously Paid:

2.	Form, Schedule or Registration Statement No.:

3.	Filing Party:

4.	Date Filed:

COMMUNITY PARTNERS BANCORP

1250 Highway 35 South

Middletown, New Jersey 07748

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

TO BE HELD MAY 18, 2010

To Community Partners Bancorp Shareholders:

The Annual Meeting of Shareholders of Community Partners Bancorp will be held at the Hilton Woodbridge, located at 120 Wood Avenue South, Iselin, New Jersey, on Tuesday, May 18, 2010, at 10:00 a.m., for the following purposes:

To elect twelve (12) directors.

To ratify the appointment of ParenteBeard LLC as the independent registered public accounting firm for the 2010 fiscal year.

To consider an advisory vote on the compensation of the Company’s named executive officers as determined by the Compensation Committee.

To act upon such other business as may properly come before the Annual Meeting.

Shareholders of record at the close of business on March 30, 2010 are entitled to notice of and to vote at the Annual Meeting. Whether or not you contemplate attending the Annual Meeting, we suggest that you promptly execute the enclosed proxy and return it to the Company.

Unlike previous years, brokers holding shares beneficially owned by their clients will no longer have the ability to cast votes with respect to the election of directors unless they have received instructions from the beneficial owner of the shares. If your shares are held by a broker, it is important that you provide instructions to your broker so your vote is counted in the election of directors.

Important notice regarding the availability of proxy materials for the 2010 Annual Meeting of Shareholders: The Proxy Statement for the 2010 Annual Meeting of Shareholders and 2009 Annual Report to Shareholders are available at http://www.cfpproxy.com/5995.

	By order of the Board of Directors,


	William D. Moss
	President and Chief Executive Officer

April 9, 2010

YOUR VOTE IS IMPORTANT. TO ASSURE YOUR REPRESENTATION AT THE ANNUAL MEETING, PLEASE VOTE YOUR PROXY, WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING.

COMMUNITY PARTNERS BANCORP

1250 Highway 35 South

Middletown, New Jersey 07748

PROXY STATEMENT FOR ANNUAL MEETING

OF SHAREHOLDERS TO BE HELD ON MAY 18, 2010

PROXY STATEMENT

This proxy statement is being furnished to the shareholders of Community Partners Bancorp (the “Company”) in connection with the solicitation of proxies by the Board of Directors of the Company for use at the Annual Meeting of Shareholders (the “Annual Meeting”) to be held on Tuesday, May 18, 2010, at 10:00 a.m., at the Hilton Woodbridge, located at 120 Wood Avenue South, Iselin, New Jersey and at any postponement or adjournment thereof.

This proxy statement, Notice of Annual Meeting and accompanying proxy card are first being mailed to shareholders on or about April 9, 2010.

Two River Community Bank (“Two River”, the “Bank”) is the only bank subsidiary of the Company.

GENERAL

The holders of record of shares of common stock of the Company at the close of business on the record date, which is March 30, 2010, are entitled to vote such shares at the Annual Meeting. On March 30, 2010, there were 7,182,497 shares of common stock outstanding entitled to vote at the Annual Meeting. In accordance with New Jersey law, a list of shareholders entitled to vote at the meeting will be available at the Annual Meeting.

The presence in person or by proxy of the holders of a majority of the shares outstanding on the record date is necessary to constitute a quorum for the transaction of business at the Annual Meeting. Each shareholder is entitled to one vote, in person or by proxy, for each share of common stock held as of the record date on each matter to be voted on at the Annual Meeting.

Abstentions and broker non-votes are included in determining the number of shares present or represented at the Annual Meeting for purposes of determining whether a quorum exists. Broker non-votes occur when a broker returns a proxy but does not have discretionary authority to vote on a particular proposal or voting instructions from the beneficial owner.

Certain proposals, such as the ratification of the appointment of auditors, are considered “routine” matters and brokers generally may vote on behalf of beneficial owners who have not furnished voting instructions. For “non-routine” proposals, such as the election of directors and an advisory vote on compensation of the Company’s named executive officers, brokers may not vote on the proposals unless they have received voting instructions from the beneficial owner.

Directors will be elected by a plurality of the votes cast at the Annual Meeting. Thus, assuming a quorum, an abstention or a broker non-vote will have no effect on the outcome of the vote on election of directors at the meeting. The appointment of ParenteBeard LLC as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2010 requires the favorable vote of a majority of the votes cast. Thus, an abstention or a broker non-vote will have no effect on the outcome. The advisory vote regarding the compensation of our named executive officers will be approved if a majority of the votes cast are FOR the proposal. Thus, abstentions and broker non-votes will have no impact on the approval of this advisory proposal.

Shares of common stock represented by proxies received in time for the Annual Meeting will be voted as specified in the proxy. Unless contrary instructions are given, the proxy will be voted for (1) the election of each of the Board of Directors’ nominees for director, (2) the ratification of the appointment of ParenteBeard LLC as the independent registered public accounting firm for the 2010 fiscal year and (3) the advisory vote on the compensation of the Company’s named executive officers. With respect to any other matters properly submitted to shareholders at the Annual Meeting, proxies will be voted as recommended by the Board of Directors or, if no recommendation is given, at the discretion of the proxy holders.

Election inspectors appointed for the Annual Meeting will tabulate the votes cast by proxy or in person at the meeting. The election inspectors will determine whether or not a quorum is present. Votes will NOT be considered cast if the shares are not voted for any reason, including an abstention indicated as such on a written proxy or ballot, if directions are given in a written proxy to withhold votes, or if the votes are withheld by a broker.

If any other matters are properly presented at the Annual Meeting for consideration, including, among other things, consideration of a motion to adjourn the Annual Meeting to another time or place, the individuals named as proxies will have discretion to vote on those matters in their best judgment to the same extent as the person delivering the proxy would be entitled to vote, unless you otherwise specify in the proxy. If the Annual Meeting is postponed or adjourned, your proxy will remain valid and may be voted at the postponed or adjourned meeting. You still will be able to revoke your proxy until it is voted. As of the date of this proxy statement, the Company is not aware of any matters that are to be presented at the Annual Meeting other than the election of directors, the ratification of the appointment of ParenteBeard LLC as independent registered public accounting firm for the 2010 fiscal year and the advisory vote on the compensation of the Company’s named executive officers.

Shareholders may vote by completing and mailing the proxy card. A proxy may be revoked if, prior to the exercise of the proxy, the Secretary of the Company receives either a written revocation of that proxy or a new proxy bearing a later date. You will be able to change your vote as many times as you wish prior to the Annual Meeting and the last vote received chronologically will supersede all prior votes. A proxy may also be revoked by voting in person at the Annual Meeting. Attendance at the Annual Meeting will not in itself constitute revocation of a proxy.

This proxy solicitation is being made by the Board of Directors of the Company, and the expense of preparing, printing, and mailing this proxy statement and proxy is being paid by the Company. In addition to use of the mails, proxies may be solicited personally, by electronic mail, by facsimile, or by telephone by our directors, officers or regular employees of the Company without additional compensation. The Company has retained the services of Regan & Associates, Inc. to aid in the solicitation, collection and tabulation of proxies from banks, brokers, nominees, and registered holders. The Company estimates that it will pay a fee of $7,000 plus out-of-pocket expenses. Arrangements may be made with brokerage houses and other custodians, nominees and fiduciaries to send proxies and proxy materials to the beneficial owners of stock. The Company will reimburse banks, brokers and other custodians, nominees and fiduciaries for their costs in sending proxy materials to the beneficial owners of common stock.

In some instances, we may deliver to multiple shareholders sharing a common address only one copy of this proxy statement and its attachments. If requested by phone or in writing, we will promptly provide a separate copy of the proxy statement and its attachments to a shareholder sharing an address with another shareholder. You may make such a request in writing to Community Partners Bancorp, Attn: Secretary of the Board, 1250 Highway 35 South, Middletown, New Jersey 07748, or by calling the Company at 732-706-9009. This proxy statement and the annual report are available at http://www.cfpproxy.com/5995. Shareholders sharing an address who currently receive multiple copies and wish to receive only a single copy should contact their broker or send a signed, written request to us at the address above.

Smaller Reporting Company

The Company has elected to prepare this proxy statement and other annual and periodic reports as a “smaller reporting company” consistent with rules of the Securities and Exchange Commission (the “SEC”) effective February 4, 2008.

ITEM 1 - ELECTION OF DIRECTORS

The Board of Directors proposes the election of twelve nominees as directors of the Company. If elected, Directors will serve until the next Annual Meeting or until their successors are chosen and qualified. The Company has inquired of each nominee and determined that each will serve if elected. In the event that any of the nominees should become unable or unavailable to serve, or for good reason will not serve, the persons named in the accompanying proxy intend to vote for such other person or persons, if any, as the Board of Directors may designate as a substitute nominee or the size of the Board may be reduced. The Board believes that the named nominees are available, and, if elected, will be able to serve. The Board of Directors recommends that shareholders vote for such nominees for directors.

DIRECTORS AND EXECUTIVE OFFICERS

The following table set forth (i) the name and age of each of the nominees for election to director; (ii) the other positions and offices presently held by such persons with the Company, if any; (iii) the period during which such persons have served on the Board of Directors of the Company, if applicable; and (iv) the principal occupations and employment of such persons during the past five years. Additional biographical information for each nominee and the Senior Executive Officers who are not a director follows the table.

NOMINEES FOR ELECTION AT 2010 ANNUAL MEETING

Name and Position with the Company, if any	Age	Director Since	Principal Occupation

Charles T. Parton, Chairman of the Board of the Company and Two River	68	2006	Chairman of the Board of the Company and Two River

Joseph F.X. O’Sullivan, Vice Chairman of the Board of the Company and Two River	56	2006	Senior executive with Fleetwood Financial Leasing, LLC;

Frank J. Patock, Jr., Vice Chairman of the Board of the Company and Two River	64	2006	President of Patock Construction Company;

Michael W. Kostelnik, Jr., Corporate Secretary and Director of the Company and Two River	67	2006	Retired President of McCue Captains Insurance Agency; Corporate Secretary and Director of the Company;

William D. Moss, President, Chief Executive Officer and Director of the Company and Two River	53	2009	President, Chief Executive Officer and Director of the Company and Two River;

Robert E. Gregory, Director of the Company, Director of Two River	53	2006	President of NJ Galvanizing and Tinning Works, Inc.; Director of the Company;

Name and Position with the Company, if any	Age	Director Since	Principal Occupation

Robert B. Grossman, MD, Director of the Company, Director of Two River	63	2009	Partner, Shore Orthopaedic Group;

John E. Holobinko, Esq., Director of the Company, Director of Two River	68	2009	Partner, Gasiorowski & Holobinko;

William F. LaMorte, Director of the Company, Director of Two River	62	2009	President of Ronstan Paper & Packaging Company, Inc.;

John J. Perri, Jr., CPA, Director of the Company, Director of Two River	61	2006	Certified Public Accountant and a partner with Raymond, Perri & DeSeno, LLC;

William Statter, Director of the Company, Director of Two River	67	2009	Retired pharmacist;

Robin Zager, Director of the Company, Director of Two River	60	2009	Partner, Commercial Property Advisors, LLC;

Frederick H. Kurtz has chosen to not seek reelection to the Board of Directors for the coming year.

Directors

Set forth below are the names of, and certain biographical information regarding, the directors of the Company as of December 31, 2009.

Charles T. Parton is currently the Chairman of the Board of the Company and Chairman of Two River. Mr. Parton previously served as Chairman, Interim President and CEO of Community Partners from February 1, 2009 to December 31, 2009. He was Chairman of Two River from April 1, 2000 to July 31, 2006, Mr. Parton previously served as Chairman of Two River from April 1, 2000 to July 31, 2006, and as President and CEO from Two River’s opening on February 29, 2000 to April 30, 2000. Mr. Parton served as Managing Member of TRB, LLC, the incorporating entity of Two River. Mr. Parton is a certified financial planner. Mr. Parton has been active in the commercial banking field for over 40 years, beginning his career in 1963 with Fidelity Union Trust Company in Newark, New Jersey, and has served as Executive Vice President and Cashier of Colonial First National Bank, Red Bank, Chairman, President and CEO of Midlantic National Bank/Merchants, Senior Vice President and Group Executive of Midlantic National Bank and Executive Vice President of the Jersey Shore Medical Center Foundation. Mr. Parton has served as a director of three SEC registered companies, and is currently a director of Kuehne Chemical Company, Inc., a privately owned enterprise. Mr. Parton has been a Trustee of Monmouth University since 1987, having served as Board of Trustees Chair from 1998 to 2001, and was elected a Life Trustee in 2002. Mr. Parton received his A.B. degree from Dartmouth College, and his MBA from Rutgers University. Mr. Parton’s experience qualifying him for service as a director includes his extensive commercial banking and corporate governance background, in addition to his extensive civic and community service.

Joseph F. X. O’Sullivan currently serves as Vice Chairman of the Board of Community Partners Bancorp and Two River Community Bank. Mr. O’Sullivan graduated in 1975 from Mount St. Mary’s University with a BS degree in Business Finance. Mr. O’Sullivan started his career in 1976 in business management, becoming a credit officer with Community State Bank. From 1979 to 1985, Mr. O’Sullivan was a Principal Managing Director serving as Chief Credit Officer and Syndication Manager for Vendor Funding, an equipment finance company, until the business was acquired in 1986 by First NH Banks, an operating unit of Bank of Ireland. He then continued to serve in those capacities as Executive Vice President until becoming Chief Financial Officer in 1990. In 1992, he became President of Credit America Corp., which specialized in equipment leasing and commercial finance in the petroleum industry. In 1995, Mr. O’Sullivan served as a Principal Managing Director of Fleetwood Financial Corp. Fleetwood Financial is an equipment leasing company headquartered in New Jersey specializing in the vendor finance marketplace, concentrating on firms selling medical technology products in the hospital and medical clinical marketplace. In 2006, Fleetwood Financial was acquired and transitioned into a bank-owned captive leasing operation. Mr. O’Sullivan served as Executive Vice President of Syndication and Risk Management of this operation until 2009, when the business was reacquired by Mr. O’Sullivan and senior management under Fleetwood Financial Leasing, LLC. Mr. O’Sullivan previously served as Chairman and Director of The Town Bank Board of Directors. Mr. O’Sullivan’s experience qualifying him for service as a director includes a thirty-five year career in financial services, twenty years as managing partner of nationwide independent equipment leasing companies and several years as a bank director.

Frank J. Patock, Jr. currently serves as Vice Chairman of the Board of Community Partners Bancorp and Two River Community Bank. Mr. Patock is also President of Patock Construction Company; a general contracting company located in Tinton Falls, New Jersey and was born and raised in the Red Bank area. He is a founder and former member of the board of directors of Tinton Falls State Bank. He is a past President of the Red Bank Rotary Club and is the current President of the Affordable Housing Alliance. Mr. Patock serves on the board of directors of American Red Cross and 180-Turning Lives Around. In addition, Mr. Patock is a member of the Eastern Monmouth Chamber of Commerce and St. Dorothea’s Church in Eatontown, New Jersey. Mr. Patock received his B.C.E. degree from Union College in Schenectady, New York and his M.S. degree from New Jersey Institute of Technology. Mr. Patock’s experience qualifying him for service as a director includes his twenty years experience as a bank director and his valuable business acumen and experience as a general contractor in the development of corporate, retail and governmental facilities.

Michael W. Kostelnik, Jr. is currently the Corporate Secretary and a director of the Company and has been a director of Two River since the bank opened. He is the retired President of McCue Captains Agency, an insurance agency located in Little Silver, New Jersey. Mr. Kostelnik, who has been involved in the insurance industry for 30 years, is a former member of the board of directors of the Independent Insurance Agents of New Jersey. Mr. Kostelnik was a member of the Community Advisory Board of Tinton Falls State Bank. Mr. Kostelnik is a past president of the Tinton Falls Rotary Club. Mr. Kostelnik received his B.A. degree from Colgate University. Mr. Kostelnik’s experience qualifying him for service as a director includes the vast general business knowledge and experience gained from his thirty year career in the insurance industry.

William D. Moss is currently President and Chief Executive Officer and a director of the Company and Two River Community Bank. Mr. Moss previously served as President and Senior Loan Officer from August 1, 2006 to July 31, 2007, as Executive Vice President and Senior Loan Officer of Two River from July 1, 2003 to July 31, 2006, and as Senior Vice President and Senior Loan Officer of Two River from February 2000 (the time of the bank’s opening) until July 2003. Mr. Moss has 30 years in the banking industry, starting his career in 1980 at Midlantic National Bank and rising to the position of Regional Vice President/Group Manager in 1989. Later that year he joined Central Jersey Bank & Trust Company, which is today Bank of America, as a Vice President and Senior Regional Loan Officer. In 1996, Mr. Moss joined Shrewsbury State Bank as Vice President, responsible for commercial lending and business development. Mr. Moss graduated from the Stonier Graduate School of Banking in 1987. Mr. Moss serves as a Trustee of the New Jersey Bankers Association and is a member of the Community Bankers Association of New Jersey. He is currently a Trustee of The Monmouth Conservation Foundation, Middletown, New Jersey; The Community YMCA, Red Bank, New Jersey; Christian Brothers Academy, Lincroft, New Jersey; and the Howard Whitfield Foundation, Red Bank, New Jersey. Mr. Moss is a former President and member of the Board of Advisors of the American Cancer Society, and has served as a Councilman of the Borough of Shrewsbury and Chair of the Finance Committee. Mr. Moss previously sat on the board of the Monmouth Day Care Center and The Monmouth County Historical Association, Freehold, New Jersey. Mr. Moss’ experience qualifying him for service as a director includes his continuing role as President and Chief Executive Officer of the Company and Two River Community Bank and his extensive career in banking, including senior management positions, along with officer and board positions with several nonprofit organizations and having held elected public office.

Robert E. Gregory is currently a director of the Company and Two River and previously served as a director at Town Bank. Mr. Gregory has been the President of NJ Galvanizing and Tinning Works, Inc. since 1982. In that capacity, Mr. Gregory is responsible for all budgeting and financial reporting. Mr. Gregory is an active member of numerous trade and non-profit organizations and is a past president of the Newark Ironbound Manufacturers Association. Mr. Gregory is a graduate of Marquette University where he obtained a Bachelors Degree. Mr. Gregory’s experience qualifying him for service as a director includes his twenty-three years of financial and business experience gained running an industrial company; as well as his charitable involvement in the local community.

Robert B. Grossman, MD is currently a director of the Company and Two River. Dr. Grossman is an orthopedic surgeon and partner with Shore Orthopaedic Group. Dr. Grossman is a licensed medical doctor in the State of New Jersey. He became Board Certified in orthopedic surgery in 1978, and is currently affiliated with Monmouth Medical Center and Riverview Medical Center. Dr. Grossman is a Fellow of the American Academy of Orthopaedic Surgery, the American Academy of Surgery, the American Sports Medicine Society, and the Arthroscopic Association of North America, just to name a few. He is a past consultant to the U.S. Soccer Federation World Cup Junior Team and a consultant at the U.S. Olympic Facility in Colorado. Dr. Grossman has been elected to Best Doctors in New Jersey, 2001. Dr. Grossman is a past president of the New Jersey Orthopaedic Society and the Campaign Chairman for Jewish Charities of Monmouth County. He was one of the founders and a member of the Board of Directors of Tinton Falls State Bank. He is the past President and past Chairman of the Board of the Jewish Federation of Greater Monmouth County. Dr. Grossman’s experience qualifying him for service as a director includes approximately twenty years of experience serving on financial institution bank boards and his extensive civic and community service.

John E. Holobinko, Esq. is currently a director of the Company and Two River. Mr. Holobinko is a partner in the law firm of Gasiorowski & Holobinko, located in Red Bank, New Jersey. The firm specializes in many areas of the law, including real estate transactions, trust and estate work, bankruptcy, municipal law, and banking-related matters. Mr. Holobinko is a former member of the Board of Directors of United Counties Bancorp and Meridian Bank. He also served on the Regional Board of Directors of CoreStates Bank. Besides belonging to the American, New Jersey and Monmouth Bar Associations, Mr. Holobinko is a member of, or affiliated with, numerous charitable and service organizations and foundations. He received his B.A. degree from Dartmouth College and his law degree from Cornell University School of Law. Mr. Holobinko’s experience qualifying him for service as a director includes the wide range of business and legal knowledge gained during his many years as a practicing attorney in addition to his prior years as a board member of several financial institutions.

William F. LaMorte is currently a director of the Company and Two River. Mr. LaMorte has been the President of Ronstan Paper & Packaging Company, Inc. for the past 33 years. Ronstan Paper is a distributor of packaging materials, paper and janitorial products based in Eatontown, New Jersey. Mr. LaMorte is a past President of Monmouth Center for Vocational Rehabilitation and the MCVR Foundation, Inc. He is a former member of the Long Branch Chamber of Commerce. He is also a past President of A.R.C. of Monmouth County. Mr. LaMorte received his B.S. degree in Business Administration from Western New England College. Mr. LaMorte’s experience qualifying him for service as a director includes thirty-three years of business and management experience in running a paper and packaging company as well as his involvement assisting non-profit organizations over his career.

John J. Perri, Jr., CPA is currently a director of the Company and Two River. Mr. Perri is a Certified Public Accountant and a partner in the accounting firm of Raymond, Perri & DeSeno, LLC, located in Tinton Falls, New Jersey. He is currently a member of the American Institute of Certified Public Accountants and the New Jersey Society of Certified Public Accountants. Mr. Perri has taught accounting at Ocean County Community College and he has lectured on various accounting and tax related topics. He is active in the Red Bank Rotary Club and is currently on the board of directors of the Monmouth Housing Alliance. Mr. Perri received his B.S. degree in accounting from Rochester Institute of Technology. He also holds a Masters degree in Taxation from Fairleigh Dickinson University. Mr. Perri’s experience qualifying him for service as a director includes his business and accounting experience as a practicing CPA and his service on a variety of boards and audit committees.

William Statter is currently a director of the Company and Two River. Mr. Statter is the former owner of Rumson Pharmacy, located in Rumson, New Jersey. Mr. Statter is a former member of the Community Advisory Board of Tinton Falls State Bank. He is the former President of the Rumson Board of Health and a former member of the Rumson Juvenile Conference Committee. At this time, Mr. Statter is the Director of Pharmacy at the Parker Family Health Center in Red Bank, and also serves on the Parker Family Health Center Board of Directors. Mr. Statter is a graduate of the University of the Maryland School of Pharmacy. Mr. Statter’s experience qualifying him for service as a director includes the business knowledge gained by his twenty-eight years of entrepreneurial experience gained while operating his pharmacy, as well as his experience in providing guidance to various charitable organizations.

Robin Zager is currently a director of the Company and Two River. Ms. Zager is a 1972 honor graduate of Douglass College in New Brunswick, New Jersey. Ms. Zager was licensed as a real estate broker by the State of New Jersey in 1982 and has devoted her entire career in the commercial real estate field. She is currently a Principal of Commercial Property Advisors LLC, a real estate transaction and consulting firm located in Fair Haven, New Jersey. Ms. Zager is also Owner and President of Arzee Property Management Corp which oversees the operations of several medical and professional buildings in Monmouth and Ocean Counties. Her volunteer experiences include past service as a Trustee of Congregation B’nai Israel in Rumson, New Jersey, where she served on the Long Range Planning and Endowment Committees. Robin was a former Director for Eastern Monmouth Area Chamber of Commerce (EMACC). Active in Red Bank Hadassah, she served as VP of Fundraising for several years. Active in Industrial/Commercial Real Estate Women (ICREW), Ms. Zager served as Treasurer for 3 years and then as President for 2 years. Following this statewide office, she served as the National Delegate to NNCREW, the national organization for commercial real estate women. Ms. Zager’s experience qualifying her for service includes her extensive experience in all segments of the commercial real estate field; as well as her significant involvement with charitable organization.

No director of the Company is also currently a director of any other company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934 or of any company registered as an investment company under the Investment Company Act of 1940.

Executive Officers

Set forth below is the name of, and certain biographical information regarding, the executive officers of the Company who did not serve as a director of the Company as of December 31, 2009.

Michael J. Gormley (age 54) is currently Executive Vice President, Chief Operating Officer and Chief Financial Officer of the Company, and Executive Vice President, Chief Financial Officer of Two River and has served in such positions since 2006. From February 2000 through 2003, Mr. Gormley served as Senior Vice President and Treasurer of Two River. Mr. Gormley previously served as Senior Vice President and Treasurer of Tinton Falls State Bank from its establishment in October of 1988 to its acquisition by Commerce Bank in January of 1999. Mr. Gormley is a past President of the Red Bank Rotary Club and is an elder and former chair of the finance committee of Forked River Presbyterian Church in Forked River, New Jersey.

Alan B. Turner (age 46) is currently Executive Vice President and Senior Loan Officer of Two River Community Bank. Mr. Turner joined Two River in October of 2000 as Vice President of Commercial Lending, and served as Senior Vice President of Commercial Lending from June of 2003 until his promotion to Executive Vice President in January of 2007. Mr. Turner has over 23 years of banking and commercial lending experience. He began his banking career in 1987 at Chemical Bank N.J. as a credit and loan review analyst. From 1989 to 1995, he served as Assistant Vice President of Commercial Real Estate at Central Jersey Bank & Trust Company in Freehold. Following Central Jersey’s acquisition by NatWest, N.A. in 1995, Mr. Turner first served as Assistant Vice President and then as Vice President of Commercial Real Estate/Relationship Manager/Team Leader. He then became Vice President of Commercial Real Estate/Relationship Manager at NatWest’s successor, Fleet Bank, N.A. of Cherry Hill, through September of 2000. Mr. Turner graduated from The American University in Washington, DC in 1986

Recommendation and Vote Required

THE COMPANY’S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” EACH OF THE DIRECTOR NOMINEES.

A director will be elected by a plurality of the votes cast at the Annual Meeting, whether in person or by proxy.

ITEM 2 - RATIFICATION OF INDEPENDENT

REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee of the Board of Directors has selected ParenteBeard LLC as the Company’s independent auditors for the 2010 fiscal year. Beard Miller Company LLP, who has served as the Company’s independent registered public accounting firm since 2006, and prior to such time served as independent registered public accounting firm for Two River since 2005, merged with another accounting firm, Parente Randolph LLC, to form ParenteBeard LLC on October 1, 2009.

In addition to selecting ParenteBeard LLC as the Company’s independent registered public accounting firm for the Company’s 2010 fiscal year, the Audit Committee has directed that management submit the selection of the independent registered public accounting firm for ratification by the Company’s shareholders at the 2010 Annual Meeting. One or more representatives of ParenteBeard LLC are expected to be present at the 2010 Annual Meeting. The representatives will have the opportunity to make a statement, if they desire to do so, and are expected to be available to respond to appropriate questions.

Shareholder ratification of the selection of ParenteBeard LLC as the Company’s independent registered public accounting firm is not required by the Company’s by-laws or otherwise. However, the Board is submitting the selection of ParenteBeard LLC to shareholders for ratification as a matter of good corporate practice. If the shareholders fail to ratify the selection, the Audit Committee will reconsider whether or not to retain that firm. Unless contrary instructions are given, the shares of common stock represented by the proxies being solicited will be voted “FOR” the ratification of the selection of ParenteBeard LLC as the Company’s independent registered public accounting firm for the Company’s 2010 fiscal year.

Independent Auditor Fees

The Sarbanes-Oxley Act of 2002 and the SEC auditor independence rules require all public accounting firms that audit issuers to obtain pre-approval from their respective audit committees in order to provide professional services without impairing independence.

The following fees were incurred for services provided by the Company’s independent registered public accounting firm in 2009 and 2008:

	2009	2008

Audit fees (1)	$136,548	$141,397
Audit-related fees (2)	16,021	1,740
Tax fees (3)	21,278	19,624
All other fees	-	-

Total	$173,847	$162,761

(1)

Includes professional services rendered for the audit of the Company’s annual financial statements, review of financial statements included in Forms 10-Q and review and consent procedures associated with a Form S-8 filing by the Company, including out-of-pocket expenses.

(2)

Includes assurance and related services that are reasonably related to the performance of the audit or review of financial statements, an audit of the employee benefit plan, including out of pocket expenses and a review of the S-3 filing related to the preferred stock issuance.

(3)

Tax fees include the following: preparation of state and federal tax returns; assistance with calculating estimated tax payments; and assistance with other tax matters.

All services described above were approved in accordance with the Audit Committee’s Pre-Approval policy described directly below.

Audit Committee Pre-Approval Procedures

The Audit Committee has adopted a formal policy concerning the pre-approval of audit and non-audit services to be provided by the Company’s independent registered public accounting firm. The policy requires that all services to be performed by the Company’s independent registered public accounting firm, including audit services, audit-related services and permitted non-audit services, be pre-approved by the Audit Committee. The policy permits the Audit Committee to delegate pre-approval authority to one or more members, provided that any pre-approval decisions are reported to the Audit Committee at its next meeting. Specific services being provided by the independent registered public accounting firm are regularly reviewed in accordance with the pre-approval policy. At subsequent Audit Committee meetings, the Audit Committee receives updates on services being provided by the independent registered public accounting firm, and management may present additional services for approval. The Company’s engagement of ParenteBeard LLC as the Company’s independent registered public accounting firm was approved in advance by the Audit Committee.

Change to ParenteBeard LLC

On October 1, 2009, the Company was notified that the audit practice of Beard Miller Company LLP was combined with ParenteBeard LLC in a transaction pursuant to which Beard Miller Company LLP combined its operations with ParenteBeard LLC and certain of the professional staff and partners of Beard Miller Company LLP joined ParenteBeard LLC either as employees or partners of ParenteBeard LLC. Accordingly, on October 1, 2009, Beard Miller Company LLP resigned as the independent registered public accounting firm of the Company and, with the approval of the Audit Committee, ParenteBeard LLC was engaged as the Company’s independent registered public accounting firm on October 6, 2009.

During the two years ended December 31, 2008 and from December 31, 2008 through the engagement of ParenteBeard LLC as the Company’s independent registered public accounting firm, neither the Company nor anyone on its behalf consulted ParenteBeard LLC with respect to any accounting or auditing issues involving the Company. In particular, there was no discussion with the Company regarding the application of accounting principles to a specific completed or contemplated transaction, the type of audit opinions that might be rendered by ParenteBeard LLC on the Company’s financial statements, or any matter that was either the subject of a disagreement, as described in Item 304 of Regulation S-K and the related instructions thereto promulgated by the SEC, with Beard Miller Company LLP, or a “reportable event” as described in Item 304(a)(1)(v) of Regulation S-K. ParenteBeard LLC did not provide any written or oral advice that was an important factor considered by the Company in reaching a decision as to any such accounting, auditing or financial reporting issue.

Beard Miller Company LLP performed audits of the Company’s consolidated financial statements for the years ended December 31, 2008 and 2007. Beard’s reports did not contain an adverse opinion or a disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope, or accounting principles.

During the two years ended December 31, 2008, and from December 31, 2008 through October 1, 2009, the date of resignation, there were no (i) disagreements between the Company and Beard Miller Company LLP on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreements, if not resolved to the satisfaction of Beard Miller Company LLP would have caused it to make reference to the subject matter of such disagreements in connection with its reports, or (ii) “reportable events,” as described in Item 304 (a)(1)(v) of Regulation S-K.

The Company furnished Beard Miller Company LLP with a copy of the above disclosures in response to Item 304(a) of Regulation S-K in conjunction with the filing of its Form 8-K. The Company requested that Beard Miller Company LLP deliver to the Company a letter addressed to the SEC stating whether it agrees with the statements made by the Company in response to Item 304(a) of Regulation S-K, and if not, stating the respects in which it does not agree. A copy of the letter of Beard Miller Company LLP was filed as Exhibit 16.1 to its Current Report on Form 8-K filed on October 6, 2009.

Recommendation and Vote Required

THE COMPANY’S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE RATIFICATION OF THE SELECTION OF PARENTEBEARD LLC AS INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE 2010 FISCAL YEAR.

The affirmative vote of the majority of votes cast is required to ratify the Board’s selection of the Company’s independent registered public accounting firm.

ITEM 3 – ADVISORY VOTE ON EXECUTIVE COMPENSATION

In response to the recent economic downturn, Congress enacted the Emergency Economic Stabilization Act of 2008 (the “EESA”) and the American Recovery and Reinvestment Act of 2009 (the “ARRA”). The EESA and ARRA, as implemented by various regulations, impose a number of requirements on financial institutions, such as the Company, that received an investment under the Capital Purchase Program of the United States Treasury’s Troubled Asset Relief Program (“TARP”). One of the requirements set forth under EESA is that at each annual meeting of shareholders during the period in which any obligation arising from TARP financial assistance remains outstanding TARP recipients shall permit a separate nonbinding “say on pay” stockholder vote to approve the compensation of executives.

This proposal gives you as a stockholder the opportunity to vote for or against the following resolution:

“RESOLVED, that the shareholders of Community Partners Bancorp (the “Company”) approve the compensation of the Company’s executives as described in the Summary Compensation Table of the Company’s Proxy Statement for the 2010 Annual Meeting of Shareholders, including the other executive compensation tables and the related disclosure contained in the Proxy Statement.”

Because your vote is advisory, it will not be binding upon the Board and may not be construed as overruling any decision by the Board. However, the Compensation Committee may, in its sole discretion, take into account the outcome of the vote when considering future executive compensation arrangements.

Shareholders are encouraged to carefully review the “Executive Compensation” section of this proxy statement for a detailed discussion of the Company’s executive compensation program.

Our overall executive compensation policies and procedures are described in the “Executive Compensation” section and the tabular disclosure regarding named executive officer compensation (together with the accompanying narrative disclosure) in this proxy statement. Our compensation policies and procedures are centered on a pay-for-performance culture and, we believe, are strongly aligned with the long-term interests of our shareholders. The Compensation Committee, which is comprised entirely of independent Directors, oversees our executive compensation program and continually monitors our policies to ensure they continue to emphasize programs that reward executives for results that are consistent with shareholder interests.

Our Board and our Compensation Committee believe that our commitment to these responsible compensation practices justifies a vote by shareholders FOR the resolution approving the compensation of our executives as disclosed in this proxy statement.

Recommendation and Vote Required

THE COMPANY’S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE NON-BINDING APPROVAL OF THE COMPENSATION OF THE NAMED EXECUTIVE OFFICERS DETERMINED BY THE COMPENSATION COMMITTEE.

The affirmative vote of the majority of votes cast will constitute approval of this advisory proposal.

CORPORATE GOVERNANCE

General

The Company is committed to establishing sound principles of corporate governance which promote honest, responsible and ethical business practices. The Company’s corporate governance practices are actively reviewed and evaluated by the Board of Directors and the Nominating and Corporate Governance Committee. This review includes comparing the Board’s current governance policies and practices with those suggested by authorities active in corporate governance as well as the practices of other public companies. Based upon this evaluation, the Board has adopted those policies and practices that it believes are the most appropriate corporate governance policies and practices for the Company.

Board Composition and Committee Memberships

The Board is currently composed of Messrs. Charles T. Parton, Joseph F.X. O’Sullivan, Frank J. Patock, Jr., Michael W. Kostelnik, Jr., William D. Moss, Robert E. Gregory, Robert B. Grossman, MD, John E. Holobinko, Esq., Frederick H. Kurtz, William F. LaMorte, John J. Perri, Jr. CPA, William Statter and Robin Zager.

The Board of Directors has a standing Audit Committee, Nominating and Corporate Governance Committee, and Compensation Committee. The table below provides current membership for each of these Board committees.

Name	Audit Committee	Compensation Committee	Nominating and Corporate Governance Committee
Charles T. Parton			X*
Joseph F.X. O’Sullivan		X
Michael W. Kostelnik, Jr.	X	X*	X
Robert E. Gregory	X
John E. Holobinko, Esq.		X
Frederick H. Kurtz			X
William F. LaMorte	X
John J. Perri, Jr., CPA	X*	X
William Statter	X
Robin Zager			X
X = Committee member; * = Chairperson

Director Independence

Effective February 1, 2009, Charles T. Parton, Chairman, assumed the additional positions of Interim President and CEO of the Company, in accordance with the recommendation of the Nominating and Corporate Governance Committee, as approved by the Board of Directors on December 16, 2008. Mr. Parton succeeded Barry B. Davall, who retired as President and CEO of the Company on January 31, 2009. These actions were consistent with the management succession plan implemented by the Company in August, 2007. The Nominating and Corporate Governance Committee oversaw the process of identifying a permanent President and CEO for the Company, which was completed with the selection of William D. Moss in November 2009. Mr. Moss assumed the position of President and CEO effective January 1, 2010.

Since the adoption of the Sarbanes-Oxley Act in July 2002, there has been growing public and regulatory focus on the independence of directors. Based on the subjective and objective criteria developed by the NASDAQ listing standards and the SEC rules, the Board of Directors has determined that a majority of the directors are “independent” within the meaning of the NASDAQ independence standards.

The Board has determined that each member of the Audit Committee is also “independent” for purposes of Section 10A(m)(3) of the Securities Exchange Act of 1934, and that each member of the Compensation Committee is an “outside director” pursuant to the criteria established by the Internal Revenue Service (the “IRS”) and is a “non-employee director” pursuant to criteria established by the SEC.

The Nominating and Corporate Governance Committee met on March 11, 2010 to determine the independence of the current members of the Board of Directors, each of which is a nominee for election as a director of the Company, with the exception of Mr. Kurtz, as well as to determine the independence of any potential nominees for director of the Company. All of the directors had previously completed a questionnaire that was used as a guide to assist in determining such person’s independence. At the Nominating and Corporate Governance Committee meeting, the Committee discussed each director’s relationship with the Company (and those of their immediate family) and other potential conflicts of interest as well as information related to transactions, relationships, or arrangements between the Company and the directors or parties related to such directors.

Following the Nominating and Corporate Governance Committee meeting, the Committee presented its conclusions to the Board. Taking into consideration the information provided by the Committee, the Board affirmatively determined that each of Messrs. Joseph F.X. O’Sullivan, Michael W. Kostelnik, Jr., Robert E. Gregory, John J. Perri, Jr., CPA, Robert B. Grossman, MD, John E. Holobinko, Esq., Frederick H. Kurtz, William F. LaMorte, William Statter and Ms. Robin Zager has no material relationship with the Company affecting his or her independence as a director and that each is “independent” within the meaning of the independence standards established by NASDAQ. In making the independence determination with respect to Mr. Kostelnik, the Nominating and Corporate Governance Committee considered Mr. Kostelnik’s employment with a company that maintains bank accounts with, has a line of credit and a term loan with Two River. In connection with the determination of Mr. Patock’s independence, the Committee considered payments made to the construction company, of which Mr. Patock is its president, as general contractor for certain construction projects. The Committee also considered the relevance of (i) Mr. O’Sullivan’s personal deposit and borrowing relationship and his employment with a company that maintains a deposit relationship with the Bank, (ii) Mr. Gregory’s personal deposit and borrowing relationship and his ownership of and employment with two companies that have deposit and borrowing relationships with the Bank, (iii) Dr. Grossman’s personal deposit and borrowing relationship and his employment with a company that maintains a deposit and borrowing relationship with the Bank, (iv) Mr. Holobinko’s personal deposit and borrowing relationship and ownership of a law firm that maintains a deposit relationship with the Bank, (v) Mr. LaMorte’s personal deposit relationship and his ownership of companies that have deposit and borrowing relationships with the Bank and the sale of paper and office supplies to Two River by Ronstan Paper and Packaging Company in the total amount of $7,687, (vi) Mr. Statter’s personal deposit and borrowing relationship with the Bank, and (vii) Ms. Zager’s personal deposit and borrowing relationship and her membership in a company that maintains a borrowing relationship with the Bank.

Board Leadership Structure

Our Board is led by a non-executive Chairman selected by the Board from time to time. After serving as Interim President and Chief Executive Officer of the Company from February 1, 2009 to December 31, 2009, Charles T. Parton resumed his position as non-executive Chairman of the Board effective January 1, 2010. The Chairman of the Board organizes Board activities to enable the Board to effectively provide guidance to and oversight and accountability of management. To fulfill that role, the Chairman, among other things: creates and maintains an effective working relationship with the Chief Executive Officer and other members of management and with other members of the Board; provides the Chief Executive Officer ongoing direction as to Board needs, interests and opinions; and assures that the Board agenda is appropriately directed to the matters of greatest importance to the Corporation. In carrying out his responsibilities, the Chairman preserves the distinction between management and oversight, maintaining the responsibility of management to develop corporate strategy and the responsibility of the Board to review and express its views on corporate strategy. The functions of the Chairman include:

presiding over all meetings of the Board and shareholders, including regular executive sessions of non-management directors of the Board;

establishing the annual agenda of the Board and the agendas of each meeting in consultation with the Chief Executive Officer;

advising committee chairs, in consultation with the Chief Executive Officer, on meeting schedules, agenda and information needs for the committees of the Board;

defining the subject matter, quality, quantity and timeliness of the flow of information between management and the Board and overseeing the distribution of that information;

coordinating periodic review of management’s strategic plan for the Corporation;

leading the Board review of the succession plan for the Chief Executive Officer and other key members of senior management;

serving as Acting Chief Executive Officer in concert with the Board until a President/CEO is selected;

coordinating the annual performance review of the Chief Executive Officer and other key members of senior management;

consulting with committee chairs about the retention of advisors and experts;

acting as the principal liaison between the independent directors and the Chief Executive Officer on sensitive issues;

working with the Nominating and Corporate Governance Committee to develop and maintain the agreed-on definitions of the role of the Board and the organization, processes and governance guidelines necessary to carry it out;

after consulting with other members of the Board and the Chief Executive Officer, making recommendations to the Nominating and Corporate Governance Committee as to the membership of various Board committees and committee chairs;

working with management on effective communication with shareholders, including being available for consultation and direct communication upon the reasonable request of major shareholders;

encouraging active participation by each member of the Board; and

performing such other duties and services as the Board may require.

Risk Oversight by Board

The Board oversees all business, property and affairs of the Company. The Chairman and the Company’s officers keep the members of the Board informed of the Company’s business through meetings and by providing reports and other materials to the members.

In addition to the general oversight of bank business, the Board on a monthly and quarterly basis reviews reports that summarizes information on Strategic, Investment and Operational Risk. This information is provided by both internal senior management and external management consultant committees. These reports provide information to the Board on many specific risk elements such as, but not limited to, Credit Risk, Portfolio Management, Interest Rate Risk, Market Monitoring and Sensitivity, Capital and Allowance for loan and lease losses adequacy, liquidity and margin trends.

Audit Committee

The Audit Committee is comprised of Messrs. John J. Perri, Jr., CPA (Chairman), Michael W. Kostelnik, Jr., Robert E. Gregory, William F. LaMorte and William Statter. The Audit Committee serves as a communication point among non-Audit Committee directors, internal auditors, the independent auditors and Company management as their respective duties relate to financial accounting, financial reporting and internal controls. The Audit Committee assists the Board of Directors in fulfilling its responsibilities with respect to accounting policies, internal controls, financial and operating controls, standards of corporate conduct and performance, financial reporting practices and sufficiency of auditing.

The Board has determined that all Audit Committee members are able to read and understand financial statements and at least one member has accounting or related financial management expertise in accordance with the applicable NASDAQ rules. The Board has also determined that John J. Perri, Jr., CPA qualifies as an “audit committee financial expert,” and serves as the Company’s “audit committee financial expert.” No member of the Audit Committee received any compensation from the Company during fiscal 2009 other than compensation for services as a director.

The Audit Committee Charter is available in the Corporate Governance section of the Company’s website at www.communitypartnersbancorp.com.

Report of the Audit Committee of the Board of Directors

The Audit Committee of the Board of Directors of the Company is comprised of three independent directors appointed by the Board of Directors (each of whom is independent for purposes of audit committee membership under applicable NASDAQ and SEC rules). The Audit Committee operates under a charter that was adopted in October 2005 and revised in March 2010 (the “Audit Committee Charter”). The Audit Committee Charter provides that the Audit Committee shall have the sole authority to appoint or replace the Company’s independent accountants.

Management is responsible for the preparation, presentation and integrity of the Company’s financial statements, accounting and financial reporting principles, internal controls, and procedures designed to ensure compliance with accounting standards and applicable laws and regulations. The Company’s independent auditors perform an annual independent audit of the financial statements and express an opinion on the conformity of those financial statements with generally accepted accounting principles in the United States of America. The Audit Committee’s responsibility is to monitor and oversee these processes and report its findings to the full Board. The Audit Committee assists the Board in monitoring:

the integrity of the financial statements of the Company;

the independent auditors’ qualifications and independence;

the performance of the Company’s internal audit function and independent auditors; and

the compliance by the Company with legal and regulatory requirements.

The Audit Committee reviews the results of the Company’s audit, of its interim quarterly reviews, the overall quality of the Company’s accounting policies and other required communications, including those described in Statement on Auditing Standards No. 61, as amended, “Communications with Audit Committees”. The Company’s independent auditors assist management, as necessary, in updating the Audit Committee concerning new accounting developments and their potential impact on the Company’s financial reporting. The Audit Committee also meets regularly with the Company’s independent auditors without management present.

The Audit Committee reviews and discusses with management the Company’s annual audited financial statements and quarterly financial statements, including the Company’s disclosures under Management’s Discussion and Analysis of Financial Condition and Results of Operations. The Audit Committee also meets with Company management, without the Company’s independent auditors present, to discuss management’s evaluation of the performance of the independent auditors.

With respect to fiscal 2009, the Audit Committee:

met with management and ParenteBeard LLC to review and discuss the Company’s audited financial statements and to discuss significant accounting issues;

periodically met with management to review and discuss quarterly financial results;

discussed with ParenteBeard LLC the scope of its services, including its audit plan;

reviewed the Company’s internal control processes and procedures;

received and reviewed the written disclosures and the letter from ParenteBeard LLC required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent accountant’s communications with the audit committee concerning independence, and discussed with ParenteBeard LLC their independence from management and the Company;

implemented various changes and actions in response to the requirements of the Sarbanes-Oxley Act, SEC regulations, and NASDAQ corporate governance standards, as they impact the Audit Committee, the financial reporting process and internal controls procedures;

reviewed and approved all audit and non-audit services provided by ParenteBeard LLC during fiscal 2009;

reviewed and approved all internal audit reports prepared by RSM McGladrey LLP and Thoms & Jordan, LLP;

reviewed and approved all Loan Review Programs prepared by CEIS Review Inc.; and

reviewed and approved all compliance audit reports prepared by Accume Partners;

Based on the foregoing review and discussions, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2009 for filing with the SEC.

	Members of the Audit Committee

	JOHN J. PERRI, JR., CPA (CHAIRMAN) ROBERT E. GREGORY MICHAEL W. KOSTELNIK, JR. WILLIAM F. LAMORTE WILLIAM STATTER

Compensation Committee

The Compensation Committee is comprised of Messrs. Michael W. Kostelnik, Jr. (Chairman), John E. Holobinko Esq., Joseph F.X. O’Sullivan and John J. Perri, Jr., CPA each of whom has been determined by the Board to be “independent” within the meaning of the NASDAQ independence standards, and each of whom is an “outside director” pursuant to the criteria established by the IRS and is a “non-employee director” pursuant to criteria established by the SEC.

No Compensation Committee member participates in any of the Company’s employee compensation programs. The Board has determined that none of the current Compensation Committee members has any material business relationships with the Company.

The Compensation Committee Charter is available in the Corporate Governance section of the Company’s website at www.communitypartnersbancorp.com.

Compensation Committee Interlocks and Insider Participation

The Corporation has no Compensation Committee interlocks. Messrs. Kostelnik, O’Sullivan, and Perri constitute all of the directors who served on the Compensation Committee at any time during 2009. Each of them is an independent outside director. None of them is a current or former officer or employee of the Company. During 2009, the Bank engaged in customary banking transactions and had outstanding loans to certain of its directors, executive officers, members of the immediate families of certain directors and executive officers, and their associates. These loans were made in the ordinary course of business and were made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with persons not related to the lender. In the opinion of management, these loans do not involve more than normal risk of collectability or present other unfavorable features. Charles T. Parton, Chairman of the Board, and Barry B. Davall, former President and Chief Executive Officer of the Company, attended Compensation Committee meetings only when and to the extent requested by the Committee. Mr. Davall did not participate in determining his own compensation.

Nominating and Corporate Governance Committee

Effective as of January 1, 2010, the Board of Directors reconstituted the Nominating and Corporate Governance Committee, which consists of Messrs. Charles T. Parton (Chairman), Michael W. Kostelnik, Jr., and Frederick H. Kurtz, and Ms. Robin Zager. Prior thereto, the Nominating and Corporate Governance Committee consisted of Messrs. Kostelnik (Chairman), Kurtz and Perri.

The Nominating and Corporate Governance Committee is responsible for recommending for consideration by the Board candidates to serve as directors of the Company as well as the re-election of current directors. The Committee also reviews recommendations from shareholders regarding corporate governance and director candidates. The procedure for submitting recommendations for director candidates is set forth below under the caption “Selection of Director Candidates”.

In accordance with the marketplace rules of the NASDAQ Capital Market, the Nominating and Corporate Governance Committee is currently, and in 2009 was, composed entirely of independent, non-management members of the Board of Directors.

The Nominating and Corporate Governance Committee Charter is available in the Corporate Governance section of the Company’s website at www.communitypartnersbancorp.com.

Selection of Director Candidates

The proposed slate of Directors presented in this proxy statement consists of twelve individuals. If approved by the shareholders, this slate of nominees will also be identical to the Board of Directors of Two River. Beginning in May 2009, meetings of the Boards of Directors of the Company and Two River will be held concurrently for the conduct of business. Prior to the consolidation of Two River and The Town Bank, separate monthly meetings of the respective bank Boards of Directors were held for the conduct of business, with the Board of Directors of the Company also meeting separately. As noted below, all directors are expected to meet the criteria listed.

The Nominating and Corporate Governance Committee has established a policy regarding the consideration of director candidates, including those recommended by shareholders. The Nominating and Corporate Governance Committee, together with the President and other Board members, will from time to time as appropriate identify the need for new Board members. Particular proposed director candidates who satisfy the criteria set forth below and otherwise qualify for membership on the Board will be identified by the Nominating and Corporate Governance Committee. In identifying candidates, the Nominating and Corporate Governance Committee will seek input and participation from the President, other Board members, and other appropriate sources, to ensure that all points of view can be considered and the best possible candidates can be identified. The Nominating and Corporate Governance Committee may also, as appropriate, engage a search firm to assist it in identifying potential candidates. Members of the Nominating and Corporate Governance Committee, the President and other Board members, as appropriate, may personally interview selected director candidates and provide input to the Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee will determine which candidate(s) are to be recommended to the Board for approval.

While the Company does not have a formal diversity policy for membership on the Board, the Board seeks directors who represent a mix of backgrounds and experiences that will enhance the quality of the Board’s deliberations and decisions. The Nominating and Corporate Governance Committee considers, among other factors, diversity with respect to viewpoint, skills, experience and community involvement in its evaluation of candidates for Board membership. Such diversity considerations are discussed by the Nominating and Corporate Governance Committee in connection with the general qualifications of each potential nominee.

Shareholders wishing to submit a director candidate for consideration by the Nominating and Corporate Governance Committee must submit the recommendation to Charles T. Parton, Chairman, Nominating and Corporate Governance Committee, c/o Community Partners Bancorp, 1250 Highway 35 South, Middletown, New Jersey 07748 in writing, not less than 90 days nor more than 120 days prior to the first anniversary date of the preceding year’s Annual Meeting. To ensure that a shareholder wishing to propose a candidate for consideration by the Nominating and Corporate Governance Committee has a significant stake in the Company, to qualify for consideration by the Nominating and Corporate Governance Committee, the shareholder submitting the candidate must demonstrate that he or she has been the beneficial owner of at least 1% of the Company’s outstanding shares for a minimum of one year prior to the submission of the request. The request must be accompanied by the same information concerning the director candidate and the recommending shareholder as described in Article I, Section 9 of the Company’s by-laws for shareholder nominations for director. The Company may also request any additional background or other information from any director candidate or the recommending shareholder, as it may deem appropriate.

All directors play a critical role in guiding the Company’s long-term business strategy and in overseeing the management of the Company. Board candidates are considered based on various criteria which may change over time and as the composition of the Board changes. The following factors, at a minimum, are considered by the Nominating and Corporate Governance Committee as part of its review of all director candidates and in recommending potential director candidates to the Board:

appropriate mix of educational background, professional background and business experience to make a significant contribution to the overall composition of the Board;

global business and social perspective;

if the Committee deems it applicable, whether the candidate would be considered a financial expert or financially literate as described in SEC or NASDAQ rules or an audit committee financial expert as defined by the Sarbanes-Oxley Act of 2002;

if the Committee deems it applicable, whether the candidate would be considered independent under NASDAQ rules and the Board’s additional independence guidelines set forth in the Company’s Corporate Governance Guidelines;

demonstrated character and reputation, both personal and professional, consistent with the image and reputation of the Company;

willingness to apply sound and independent business judgment;

ability to work productively with the other members of the Board;

availability for the substantial duties and responsibilities of a director of the Company; and

availability and willingness to regularly act as an ambassador for the Company in the greater community and participate in the solicitation and encouragement of new business and individual banking relationships.

Attendance at Board Meetings, Committee Meetings, and Annual Meetings

In 2009, the Board of Directors held twelve meetings, the Audit Committee held nine meetings, the Compensation Committee held seven meetings, and the Nominating and Corporate Governance Committee held four meetings. Each director attended at least 75% of the aggregate meetings of the Board of Directors and of the committees of which such director was a member.

Our current director attendance policy is that unless there are mitigating circumstances, such as medical, family or business emergencies, Board members are expected to participate in all Board meetings and all committee meetings of which the director is a member and to attend the Company’s Annual Meeting of shareholders. All, except for one Board member, attended last year’s annual meeting of shareholders.

Executive Sessions of Non-Management Directors

Our Corporate Governance Guidelines adopted in March of 2007 provide for non-management directors to meet in executive session at least four times per year. At each executive session, the non-management directors select a director to preside at the meeting. On four occasions during 2009, the non-management directors met in executive session and during all other director meetings the opportunity to meet in executive session without management present was available.

Shareholder Communications Process

The Board of Directors provides a process for security holders to send communications to the Board. Information regarding the Company’s process for shareholders to communicate with the Board of Directors and the manner in which such communications are forwarded is available under the Corporate Governance section of the Company’s website at www.communitypartnersbancorp.com.

Code of Business Conduct and Ethics and Corporate Governance Guidelines

The Company has adopted a Code of Business Conduct and Ethics (the “Code of Conduct”) which applies to the Company’s chief executive officer, the principal financial and accounting officer and to all other Company directors, officers and employees. The Code of Conduct is available under the Corporate Governance section of the Company’s website at www.communitypartnersbancorp.com. The Company will disclose any substantive amendments to the Code as well as any waivers from provisions of the Code made with respect to the chief executive officer, principal financial officer, principal accounting officer, any other executive officer or any director, at the same location on the Company’s website.The Company has also adopted Corporate Governance Guidelines which are intended to provide guidelines for the governance of the Company by the Board and its committees.

STOCK OWNERSHIP OF MANAGEMENT AND PRINCIPAL SHAREHOLDERS

The following table sets forth information concerning the beneficial ownership of the Company common stock as of March 12, 2010 by each director/nominee, by the Company’s named executive officers, by all directors and executive officers as a group, and by any individual or group owning 5% or more of the Company’s common stock. The Company knows of no person or group that beneficially owns 5% or more of the Company common stock. Unless otherwise specified, all persons listed below have sole voting and investment power with respect to their shares of Company common stock.

Name of Beneficial Owner	Amount and Nature of Beneficial Ownership		Percent of Class
Charles T. Parton	130,698	(1)	1.82%
Joseph F.X. O’Sullivan	73,231	(2)	1.02%
Michael W. Kostelnik, Jr.	109,457	(3)	1.52%
Barry B. Davall	70,061	(4)	.97%
Robert E. Gregory	142,299	(5)	1.98%
Robert Grossman, M.D.	136,526	(6)	1.90%
John E. Holobinko	122,145	(7)	1.70%
William F. LaMorte	110,092	(8)	1.53%
Frederick H. Kurtz	80,290	(9)	1.12%
Frank J. Patock, Jr.	132,176	(10)	1.84%
John J. Perri, Jr., CPA	110,998	(11)	1.54%
William Statter	106,716	(12)	1.48%
Robin Zager	113,115	(13)	1.57%
William D. Moss	94,038	(14)	1.31%
Michael J. Gormley	87,124	(15)	1.21%

All Directors & Executive Officers	1,618,966		22.51%

(1) Includes: 17,131 shares held solely by Mr. Parton’s spouse; 2060 shares held by a retirement plan of which Mr. Parton is the primary beneficiary; and options for 30,904 shares granted under Stock Option Plans of the Company.

(2) Includes: 3,108 shares held in the names of Mr. O’Sullivan’s children, for which Mr. O’Sullivan is deemed to have beneficial ownership; and options for 5,699 shares granted under Stock Option Plans of the Company

(3) Includes: 31,200 shares that are held jointly with Mr. Kostelnik’s spouse; 50,203 shares held by a retirement plan of which Mr. Kostelnik is the primary beneficiary; and options for 27,829 shares granted under Stock Option Plans of the Company.


(4) Includes: 49,194 shares held by a retirement plan of which Mr. Davall is the primary beneficiary; 6,192 shares that are held jointly with Mr. Davall’s spouse; 9,525 shares held by a retirement plan of which Mrs. Davall is the primary beneficiary; and options for 5,150 shares granted under Stock Option Plans of the Company. Mr. Davall retired as a director for the Company effective December 31, 2009.

(5) Includes: options for 8,466 shares granted under Stock Option Plans of the Company.

(6) Includes: 65,343 shares that are held jointly with Dr. Grossman’s spouse, 656 shares owned solely by Dr. Grossman’s spouse, 873 shares held in trust for minors for which Dr. Grossman has voting control; and options for 40,128 shares granted under Stock Option Plans of the Company.

(7) Includes: 11,062 shares held in various trusts established by Mr. Holobinko; and options for 40,128 shares granted under Stock Option Plans of the Company.

(8) Includes: 1,705 shares held solely by Mr. LaMorte’s spouse, 66,554 shares owned by Ridge Investments, of which Mr. LaMorte is a principal; and options for 40,128 shares granted under Stock Option Plans of the Company.

(9) Includes: options for 5,150 shares granted under Stock Option Plans of the Company.

(10) Includes: 19,004 shares held solely by Mr. Patock’s spouse; 10,898 shares owned by Patock Construction Profit Sharing Trust, in which Mr. Patock is a principal; and options for 30,904 shares granted under Stock Option Plans of the Company.

(11) Includes: options for 38,628 shares granted under Stock Option Plans of the Company.

(12) Includes: 26,695 shares that are held jointly with Mr. Statter’s spouse; 49,192 shares held by a retirement plan of which Mr. Statter is the primary beneficiary; and options for 27,829 shares granted under Stock Option Plans of the Company.

(13) Includes: 5,239 shares held solely by Ms. Zager’s spouse; and options for 27,829 shares granted under Stock Option Plans of the Company.

(14) Includes: 4,608 shares held solely by Mr. Moss’ spouse; 4,780 shares held by a retirement plan of which Mr. Moss is the primary beneficiary; 842 shares held in trust for Mr. Moss’ children; and options for 55,548 shares granted under Stock Option Plans of the Company.

(15) Includes: 14,523 shares held in a retirement plan of which Mr. Gormley is the primary beneficiary; and options for 71,476 shares granted under Stock Option Plans of the Company.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Company’s executive officers and directors, and persons who own more than 10% of a registered class of the Company’s equity securities, to file reports of ownership and changes in ownership with the SEC. Based on a review of the copies of reports furnished to the Company, the Company believes that during the year ended December 31, 2009; all filing requirements applicable to its officers, directors and 10% beneficial owners were met.

DIRECTOR COMPENSATION

The following table details the compensation paid to our non-employee directors for the year ended December 31, 2009.

Name	Fees Earned or Paid in Cash ($)	Option Awards ($)(1)	All Other Compensation ($)(2)	Total ($)
Joseph F.X. O’Sullivan	23,700	5,193	-	28,893
Frank J. Patock, Jr.	22,500	5,193	225	27,918
Michael W. Kostelnik, Jr.	26,350	5,193	233	31,776
Robert E. Gregory	15,200	5,193	-	20,393
Robert B. Grossman, M.D.	11,350	5,193	144	16,687
John E. Holobinko, Esq.	21,450	5,193	233	26,876
Frederick H. Kurtz	14,450	5,193	-	19,643
William F. LaMorte	15,850	5,193	131	21,174
John J. Perri, Jr., CPA	32,050	5,193	152	37,395
William Statter	23.900	5,193	252	29,345
Robin Zager	14,100	5,193	123	19,416

	(1)	Amounts calculated using the provisions of Financial Accounting Standards Board Accounting Standards Codification Topic 718 (formerly “SFAS” No. 123R). Amounts represent the aggregate grant date fair value of option awards made during the fiscal year ending December 31, 2009. We disclose the assumptions that we used in determining these amounts in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2009.

	(2)	Reflects amounts of imputed income under the life insurance program, which we describe under the caption “Director Life Insurance Program.”

Fees Earned or Paid in Cash

For 2009, director fees are $500 for each holding company meeting attended and $1,000 for each bank board meeting attended. Both holding company directors and bank directors receive $350 for each holding company committee meeting that they attend. A director serving on the board of the holding company who also serves on the board of the bank does not receive additional compensation for attending a bank board meeting on the same day that the director attends a holding company board meeting. The chairpersons of each of the Asset/Liability, Audit, and Compensation committees receive $750 for each meeting attended of their respective committee. Effective February 2010, the fee for attending bank board meetings increased to $1,250 per meeting and the fee for attending committee meetings increased to $400 per meeting.

We report Messrs. Parton’s and Davall’s compensation in the Summary Compensation Table. For 2010, Mr. Parton will receive $40,000 in cash compensation for serving as Chairman of the Board of Directors of the Company.

Director Life Insurance Program

We purchased single premium life insurance for certain of our directors in 2004 and 2010. Under both director insurance programs, a covered individual is provided with term insurance coverage in the amount of $100,000. Coverage will remain in effect even if the individual’s service as a member of the Board of Directors ceases. The director will forfeit any right to a benefit under the program if the Company terminates the director for cause. We paid the premiums for the director life insurance program in the year the policies were purchased. We have all ownership rights to the policies and all cash values thereunder. The premiums for life insurance paid for the benefit of the individual directors are represented in the “All Other Compensation” column of the 2009 Director Compensation table. In 2010, Messrs. Gregory, and O’Sullivan began participation in the director life insurance program.

EXECUTIVE COMPENSATION

This section of the proxy statement explains our compensation program for our principal executive officers and our other two most highly-compensated executive officers for 2009, which we refer to collectively in this proxy statement as our “named executive officers”. The Company has elected to use the “smaller reporting company” rules issued by the SEC regarding the disclosure of executive compensation.

SUMMARY COMPENSATION TABLE

The table below summarizes the total compensation paid or earned by each of the Company’s named executive officers for the fiscal years ended December 31, 2009 and 2008.

Name and Principal Position	Year	Salary ($)	Bonus ($)	Option Awards ($)(1)	Nonqualified Deferred Compensation Earnings ($)(2)	All Other Compensation ($)(3)	Total ($)
Charles T. Parton Interim President and CEO	2009	86,000	0	5,193	0	11,461	102,654
Barry B. Davall Former President and CEO	2009 2008	16,000 194,000	0 0	5,193 0	0 18,426	15,877 23,472	37,070 235,898
William D. Moss Executive Vice President and Senior Loan Officer	2009 2008	205,000 192,500	0 0	52,704 0	15,148 19,845	33,137 100,632	305,989 312,977
Michael J. Gormley Executive Vice President, Chief Operating Officer and Chief Financial Officer	2009 2008	194,000 183,000	0 0	52,704 0	17,105 22,410	13,214 13,476	277,023 218,886

(1)

Amounts calculated using the provisions of Financial Accounting Standards Board Accounting Standards Codification Topic 718 (formerly “SFAS” No. 123R). Amounts represent the aggregate grant date fair value of option awards made during the fiscal year ending December 31, 2009. We disclose the assumptions that we used in determining these amounts in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2009. Stock option awards granted to Messrs. Moss and Gormley on January 20, 2009 vest in equal increments over a five-year period beginning January 20, 2010. Stock option awards granted to Messrs. Parton and Davall on January 20, 2009 vested immediately.

(2)

The amounts in this column represent the change in the actuarial present value of the named executive officer’s accumulated benefit under his Supplemental Executive Retirement Agreement with the Company (as computed on the pension plan measurement dates used for financial statement reporting purposes for the Company’s audited financial statements in fiscal 2008 and 2009). The Company does not offer any non-qualified defined contribution plans and no named executive officer received preferential or above-market earnings on deferred compensation.

(3)	The amounts in this column for 2009 includes the following:

For Mr. Parton, $11,142 for the cost of a membership in a country club approved by the Compensation Committee, and $319 for imputed income for a Director life insurance policy.

For Mr. Davall, $14,950 for director fees earned from February 1, 2009 to December 31, 2009, $48 of imputed income for split dollar and group term life insurance for Mr. Davall’s benefit, and a contribution of $ 879 to the Company’s 401(k) Plan on behalf of Mr. Davall to match a pre-tax elective deferral contribution made by Mr. Davall to that plan.

For Mr. Moss, $2,251 for use of an automobile, $609 of imputed income for split dollar and group term life insurance for Mr. Moss’s benefit, $22,092 for the cost of a membership in a country club approved by the Compensation Committee and a contribution of $8,185 to the Company’s 401(k) Plan on behalf of Mr. Moss to match a pre-tax elective deferral contribution made by Mr. Moss.

For Mr. Gormley, $4,887 for use of an automobile, $581 of imputed income for split dollar and group term life insurance for Mr. Gormley’s benefit, and a contribution of $7,746 to the Company’s 401(k) Plan on behalf of Mr. Gormley to match a pre-tax elective deferral contribution made by Mr. Gormley.

Mr. Davall retired as President and CEO effective January 31, 2009, and as a director effective December 31, 2009. Upon Mr. Davall’s retirement as President and CEO, Mr. Parton served as Interim President and CEO through December 31, 2009. Mr. Moss became President and CEO effective January 1, 2010.

Executive Life Insurance

The Company has entered into an endorsement split dollar life insurance arrangement with several executives. Under the terms of the individual life insurance agreements, the covered employees obtain current life insurance protection while employed, and cash value accumulates under the underlying policies. In the event that a covered employee terminates employment with the Company, then coverage and all rights of the employee under the agreement and the policies cease, unless the employee had both attained age 60 and completed 10 years of service with the Company (including years of service prior to implementation of the agreements) at the time of termination of employment, in which case coverage will remain in effect until death. In addition, in the event of a change of control (as defined in the agreements) prior to termination of employment, coverage will remain in effect until death. Coverage would cease in the event of termination of employment for cause (as defined in the agreements). The Company paid the insurance premiums for these split dollar life insurance arrangements.

The Company owns the policies and all cash values thereunder. Upon the death of the covered employee, if the agreement is still in effect, the death proceeds will be used by the Company to pay to the insured’s beneficiary an amount that ranges from one to two times the covered employee’s base annual salary (not including bonus or other forms of compensation) in effect at the time of his or her death or retirement, minus amounts payable by reason of any other group term insurance coverage provided by the Company. The Company is entitled to all other amounts payable under the policies. During 2008, Messrs. Davall, Gormley, and Moss were parties to these agreements. At December 31, 2009, the death benefit payable under Mr. Moss’s policy was $205,000, and the death benefit payable under Mr. Gormley’s policy was $194,000.

Requirements of Recently Enacted Legislation

We participated in the Troubled Asset Relief Program Capital Purchase Program (referred to in this section as the “TARP”) established under the Emergency Economic Stabilization Act of 2008, as amended (together with all associated regulations, interpretations, and guidance, “EESA”) pursuant to which, on January 30, 2009, the U.S. Department of the Treasury (“Treasury”) invested approximately $9 million in our preferred stock.

Participation in the TARP Program requires that we implement certain restrictions and limitations on executive compensation, in particular severance pay, requires a review of our incentive compensation programs to ensure that they do not encourage our senior executive officers to take unnecessary and excessive risks, and limits our ability to receive tax deductions related to senior executive pay. Among the key items established by EESA, each of which generally remains in effect for TARP participants while any TARP obligations remain outstanding:

Exclude Incentives to Take Unnecessary and Excessive Risk: EESA requires a TARP participant’s compensation committee to limit features in compensation plans that encourage senior executive officers (“SEOs”) to take risks that are unnecessary or excessive or that threaten the value of the TARP participant.

Limits on the Payment, or Accrual, of any Bonus, Retention Award or Incentive Compensation: EESA prohibits the payment or accrual of any bonus, retention award or incentive compensation to the most highly compensated employee of the Company except in the form of long-term restricted stock that does not become fully transferable until we repay all TARP assistance (for each 25% of total assistance repaid, 25% of the award may become transferable), has a minimum vesting period of at least two years, and does not exceed one-third of the employee’s total annual compensation in the year of grant.

Prohibition on Golden Parachute Payments: EESA prohibits golden parachute payments to SEOs and the next five most highly compensated employees, which include substantially all payments made upon (i) such employee’s departure from the TARP participant for any reason other than death or disability or (ii) the effective date of a change in control of the TARP participant.

Clawback: EESA requires that any bonus payment made to the SEOs or the next 20 most highly compensated employees (collectively, “Covered Employees”) must be subject to a clawback provision that provides for the clawback or recovery of the bonus payment if it was based on materially inaccurate financial statements or any other materially inaccurate performance metric criteria.

Prohibition on Tax Gross-Ups: EESA generally prohibits TARP participants from providing tax gross-ups to Covered Employees.

In addition, EESA includes the following notable provisions that are generally applicable to TARP participants:

Certification of Compliance: The principal executive officer and principal financial officer and the compensation committee must provide written certifications of compliance with the identified provisions of, and in the form provided in, EESA in the Company’s annual filings with the Securities and Exchange Commission.

Risk Review by Compensation Committee: The independent compensation committee must meet at least every six months to discuss and evaluate, among other things, employee compensation plans in light of an assessment of any risk posed to the TARP participant from such plans, and to ensure that employee compensation plans do not encourage the manipulation of the TARP participant’s reported earnings to enhance the compensation of its employees, as well as to discuss and evaluate whether SEO compensation plans encourage SEOs to take unnecessary and excessive risks that threaten the value of the TARP participant.

Luxury Expenditures Policy: Each TARP participant must implement and publicly post on its website a company-wide policy regarding excessive or luxury expenditures.

Annual Non-Binding Shareholder Approval of Executive Compensation: The proxy statement of a TARP participant must permit a separate, non-binding shareholder vote to approve the compensation of executives.

2009 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

The following table represents stock options outstanding for each named executive officer as of December 31, 2009. All stock options have been adjusted for stock dividends and stock splits.

Option Awards
Name	Number of Securities Underlying Unexercised Options Exercisable (#)		Number of Securities Underlying Unexercised Options Unexercisable (#)	Option Exercise Price ($)	Option Expiration Date
Barry B. Davall	30,747 15,373 25,324 11,255 5,150	(1) (2) (3) (4) (5)	0 0 0 0 0	3.25 3.53 12.08 15.33 3.64	5/10/2011 1/22/2012 6/11/2013 8/30/2014 1/20/2019
William D. Moss	5,595 10,761 19,696 11,255 0	(1) (2) (3) (4)	0 0 0 0 41,200 (6)	3.25 3.53 12.08 15.33 3.64	5/10/2011 1/22/2012 6/11/2013 8/30/2014 1/20/2019
Michael J. Gormley	21,523 10,761 19,696 11,255 0	(1) (2) (3) (4)	0 0 0 0 41,200 (6)	3.25 3.53 12.08 15.33 3.64	5/10/2011 1/22/2012 6/11/2013 8/30/2014 1/20/2019

(1)

These options were granted on May 10, 2001, and vested in equal increments over a three-year period. We granted these options under the Two River Community Bank Incentive Stock Option Plan (2001), which plan we assumed in connection with our acquisition of Two River Community Bank.

(2)

These options were granted on January 22, 2002, and vested in equal increments over a three-year period. We granted these options under the Two River Community Bank Incentive Stock Option Plan (2001), which plan we assumed in connection with our acquisition of Two River Community Bank.

(3)

These options were granted on June 11, 2003, and vested in equal increments over a three-year period. We granted these options under the Two River Community Bank 2003 Incentive Stock Option Plan, which plan we assumed in connection with our acquisition of Two River Community Bank.

(4)

These options were granted on August 30, 2004, and vested in equal increments over a three-year period. We granted these options under the Two River Community Bank 2003 Incentive Stock Option Plan, which plan we assumed in connection with our acquisition of Two River Community Bank.

(5)

These options were granted on January 20, 2009, as non-qualified options and were fully vested on the grant date. We granted these options under the Community Partners Bancorp 2007 Equity Incentive Plan, which we describe below.

(6)

These options were granted on January 20, 2009, and vest in equal increments over a five-year period beginning January 20, 2010. We granted these options under the Community Partners Bancorp 2007 Equity Incentive Plan, which we describe below.

EQUITY INCENTIVE, EMPLOYMENT AND CHANGE IN CONTROL ARRANGEMENTS

Equity Incentive Plan

We maintain the Community Partners Bancorp 2007 Equity Incentive Plan, which we refer to as the “2007 Plan.” The following is a brief description of the 2007 Plan:

Types of Awards. The Plan provides that the Company may grant participants stock options, restricted stock, or such other awards as the Committee may determine. Options awarded under the Plan may be either options that qualify as incentive stock options (“ISOs”) under Internal Revenue Code, or options that do not, or cease to, qualify as incentive stock options under the Code.

Eligibility. Awards may be granted under the 2007 Plan to current and prospective employees, consultants, and non-employee directors.

Shares Available. A total of 819,545 shares have been reserved and are available for issuance in connection with awards under the 2007 Plan, with the total number of shares which may be issued in connection with awards that are granted as ISOs limited to 819,545. As of December 31, 2009, there were 394,155 shares available for issuance under the 2007 Plan.

Per-Person Award Limitations. Participants are limited in any year to awards under the 2007 Plan relating to no more than 25,000 shares per type of award (that is, options, restricted stock, and other awards), plus the amount of the participant’s unused annual limit relating to the same type of award as of the close of the previous year, subject to adjustment.

Terms of Stock Options. The exercise price per share purchasable under either an ISO or a NQSO may not be less than the fair market value of a share of stock on the date of grant of the option. The Compensation Committee will determine the term of each option, but no ISO may have a term in excess of ten years from the date of grant. The Compensation Committee will determine the time or times at which or the circumstances under which an option may be exercised.

Terms of Restricted Stock. Restricted stock is stock which is subject to certain restrictions and to a risk of forfeiture. The Compensation Committee will determine the period over which any restricted stock which is issued under the 2007 Plan will vest, and will impose such restrictions on transferability, risk of forfeiture, and other restrictions as the Compensation Committee may in its discretion determine. Unless restricted by the Compensation Committee, a participant granted restricted stock will have all of the rights of a shareholder, including the right to vote the restricted stock and the right to receive dividends with respect to that stock.

Change in Control. In general, in the event of a Change in Control (as defined in the 2007 Plan) all outstanding unvested awards will become fully exercisable and vested as of the time of the Change in Control, and all restricted stock and awards subject to risk of forfeiture will become fully vested. The Compensation Committee may, at its discretion, determine to extend to any participant who holds options or other awards, the right to elect during the 60-day period immediately following a Change in Control, in lieu of acquiring shares, to receive in cash (based upon a formula as described in the 2007 Plan).

Supplemental Executive Retirement Agreements

On January 1, 2005, the Company entered into supplemental executive retirement agreements (the “SERP Agreements”) with each of Messrs. Davall, Moss, and Gormley, effective November 1, 2004, to provide nonqualified pension benefits to the participants. The SERP Agreements were amended on October 30, 2008, to comply with the requirements of Code Section 409A and in certain other respects.

Under the SERP Agreements, upon Messrs. Moss and Gormley attaining age 65 and Mr. Davall attaining age 67, each is entitled to an annual benefit. Mr. Davall’s annual benefit is $30,000 and Messrs. Moss’s and Gormley’s annual benefit is $50,000. The foregoing benefits commence within 30 days after a participant attains their specified age and are paid in monthly installments for 15 years. Mr. Davall’s payments under his SERP Agreement commenced on June 1, 2009 (i.e., the first day of the month following his 67th birthday).

In addition to the foregoing, the SERP Agreements also provide for the following benefits, which are payable upon the following events, commence at the following times, and are paid in the following forms:

In the event that a participant separates from service prior to age 65 for reasons other than death, disability, an involuntary termination for cause, or a change in control, the participant is entitled to a pro-rata annual benefit based on his age at the time he separates from service ($9,355 and $10,564 for Messrs. Moss and Gormley, respectively, as of December 31, 2009), commencing within 30 days after he separates from service and paid in monthly installments for 15 years;

In the event that a participant becomes disabled while in active service prior to age 65, the participant is entitled to a pro-rata annual benefit based on his age at the time he becomes disabled ($20,810 and $21,671 for Messrs. Moss and Gormley, respectively, as of December 31, 2009), commencing within 30 days after he attains age 65 and paid in monthly installments for 15 years;

In the event that a participant dies while in active service prior to age 65, the participant is entitled to a pro-rata benefit based on his age at the time of his death ($296,473 and $311,370 for Messrs. Moss and Gormley, respectively, as of December 31, 2009), paid in a lump sum within 90 days after the date of death; and

In the event that a change in control occurs while a participant is a full-time employee, the participant is entitled to a pro-rata annual benefit based on his age at the time of the change in control ($30,824 and $32,373 for Messrs. Moss and Gormley, respectively, as of December 31, 2009), commencing within 30 days after he separates from service and paid in monthly installments for 15 years.

The SERP Agreements include non-competition provisions, which, other than in the event of a change in control, restrict the participants from competing with the Company during the one-year period following the participant’s separation from service.

Payments from the SERP Agreements may be delayed upon a participant’s termination of employment in accordance with Code Section 409A.

Effective March 1, 2010, the benefits payable under Mr. Gormley’s SERP Agreement will increase from a normal retirement benefit of $50,000 per year for 15 years to $66,000 per year for 15 years.

The Company’s ability to provide enhanced benefits under the SERP Agreements as a result of a change in control is affected by the terms of the Company’s participation in the TARP Program. See the section titled “Requirements of Recently Enacted Legislation” for further details.

Change in Control Agreements

The Company entered into change in control agreements with Messrs. Davall, Moss, and Gormley, effective June 1, 2007. The Company’s Compensation Committee approved and authorized the Company to enter into the agreements on March 19, 2007. Each of these agreements were amended effective October 30, 2008, to comply with the requirements of Code Section 409A and to modify certain provisions. Each agreement is substantially the same. Mr. Davall’s change in control agreement terminated upon his retirement effective January 31, 2009.

The change in control agreements have an initial term ending on the later of (i) the second anniversary of the date of the agreement (i.e., June 1, 2009), or (ii) the end of the contract period (as defined below). On the first anniversary of the date of the agreement (i.e., June 1, 2008), pursuant to the terms of the agreements, the initial term of each agreement was automatically extended for one additional year (meaning that the initial term, as extended, would end on the later of May 31, 2010 or the end of the contract period). The Company’s Board of Directors decided that there would be no further extensions of the initial term after June 1, 2008. As a result, Messrs. Moss’s and Gormley’s agreements will expire on May 31, 2010.

Each change in control agreement provides for severance payments to be made, and other benefits to be made available, to the executive if the executive’s employment is terminated after a change in control (as defined in the change in control agreements) of the Company, during the contract period.

Under each of the change in control agreements, if the executive is terminated by the Company without “cause” or if the executive resigns for “good reason” during the period commencing the day immediately preceding a change in control and ending on the earlier of the third anniversary of the change in control or the death of the executive (such period, the “contract period”), the executive will receive a lump sum severance payment equal to two times the executive’s highest annual salary and bonus during the three years prior to the year of termination. In addition, the Company will continue to provide the executive with medical, dental, life, and disability insurance coverage during the contract period; provided, however, that such benefits will cease if the executive becomes eligible for similar benefits with a subsequent employer prior to the end of the contract period. In addition, the Company will also sell to the executive, for a purchase price of $1, the company-provided automobile, if any, used by the executive while employed by the Company. The foregoing payments and benefits are conditioned upon the executive signing a release of claims in favor of the Company

If the executive’s employment is terminated by the Company for “cause” or the executive resigns without “good reason” during the contract period, the executive’s change in control agreement will terminate without further obligation of the Company, except that the Company will pay to the executive all accrued but unpaid salary or benefits, if any. In the event of the executive’s death, disability, or retirement during the contract period, the executive (or the estate of the executive, as the case may be) would be entitled to payment of any accrued but unpaid salary or benefits.

Under the change in control agreements, “cause” generally means:

the willful and continued failure by the executive to perform his duties after at least one warning in writing from the Board identifying specifically any such failure;

willful misconduct of any type by the executive, including, but not limited to, the disclosure or improper use of confidential information, which causes material injury to the Company, as specified in a written notice to the executive from the Board; or

the executive’s conviction of a crime (other than a traffic violation), habitual drunkenness, drug abuse, or excessive absenteeism (other than for illness), after a warning (with respect to drunkenness or absenteeism only) in writing from the Board to refrain from such behavior.

Under the change in control agreements, “good reason” generally means the occurrence of any of following events that constitute material negative changes to the executive in his relationship with the Company as the relationship existed immediately prior to a change in control (unless the executive gives his express written consent), which the Company fails to cure:

the material reduction of duties or the assignment to the executive of any duties inconsistent with the executive’s position and responsibilities;

any removal of the executive from, or any failure to re-elect the executive to, any positions or offices held immediately prior to a change in control;

relocation of the executive outside of New Jersey or more than 25 miles from his present office location;

a reduction in base compensation or any material fringe benefit or the failure to award the executive annual increases or to continue any bonus plan in which the executive participated or to continue the executive as a participant in such plan;

the failure to continue any employee benefit plan in which the executive is participating or adversely affecting or materially reducing his participation or benefits under such a plan;

the failure to provide the executive with the same number of paid vacation days; and

the failure to obtain, in writing, an enforceable assumption of the change in control agreement and the employer’s obligations to perform under the change in control agreements (and to provide such assumption to the executive prior to any change in control) by any entity which is the acquiring entity or successor to the Company or to Two River or, if the acquiring entity or successor to Two River is a bank, the holding company parent of the acquiring entity or successor.

The change in control agreements contain non-disclosure provisions which require the executives to keep confidential certain Company information. In addition, the agreements include non-competition provisions, which, upon a termination entitling the executive to severance, restrict the executive from competing with the Company during the one-year period following the executive’s termination of employment.

Our obligation to make payments under these agreements is affected by the terms of our participation in the TARP Program. See the section titled “Requirements of Recently Enacted Legislation” for further information. Under ARRA, except in limited circumstances, no severance payments are permitted to be made to our named executive officers and our five next most highly paid employees during the Covered Period.

Excise Tax Reimbursement Agreements

On July 5, 2007, the Company entered into excise tax reimbursement agreements with each of Messrs. Davall, Moss, and Gormley. The Company’s Compensation Committee had previously approved and authorized the Company to enter into the excise tax reimbursement agreements on March 19, 2007. Each of these agreements were amended effective October 31, 2008, to comply with the requirements of Code Section 409A. Each agreement is substantially the same. Mr. Davall’s agreement terminated upon his retirement effective January 31, 2009. Messrs. Moss’s and Gormley’s agreements are scheduled to expire on May 31, 2010, consistent with the expiration date of their change in control agreements.

The excise tax reimbursement agreements provide that the Company will make a gross-up payment to an executive in the event that all or any portion of the payments to such executive under any present or prospective compensation arrangement sponsored by the Company or its subsidiaries or affiliates in which the executive is or becomes a participant is determined to constitute “excess parachute payments” within the meaning of Code Section 280G(b)(1) and becomes subject to the excise tax imposed under Code Section 4999, thus restoring the executive to the after-tax position that the executive would have been in if the excise tax had not been imposed.

Mr. Davall was not entitled to any payments under his excise tax reimbursement arrangement upon his retirement on January 31, 2009.

CERTAIN TRANSACTIONS WITH MANAGEMENT

Transactions with Related Persons

The Company, through its subsidiary Banks, has made loans to its directors and executive officers and their associates and, assuming continued compliance with generally applicable credit standards, it expects to continue to make such loans. All of these loans (i) were made in the ordinary course of business; (ii) were made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable loans with other persons; and (iii) did not involve more than the normal risk of collectability or present other unfavorable features. As of December 31, 2009, the Company had total loans and loan commitments outstanding to directors and executive officers and their affiliates of approximately $10.1 million, or approximately 13.2% of total shareholder’s equity at that date. As of December 31, 2009, no director or executive officer of the Company was in default under any loan transaction with the Company or the Bank.

William F. LaMorte is President of Ronstan Paper and Packaging Company and a member of the Board of Directors. In 2009 and 2008, Ronstan Paper and Packaging Company sold paper and office supplies to Two River and the total cost amounted to $7,812 in fiscal year 2009 and $7,687 in fiscal year 2008.

Frank J. Patock Jr. is President of Patock Construction Company and a member of the Board of Directors. In 2009, Patock Construction Company acted as the general contractor for property improvement work at various branch offices. In 2008 Patock Construction acted as the general contractor for the interior construction of Two River’s Allaire, New Jersey office and the interior improvements at the Operations Center located in Eatontown, New Jersey. The cost of the interior construction and finishing work totaled $69,298 in fiscal year 2009 and $579,072 in fiscal year 2008. These payments to Patock Construction Company include payments made for subcontractors, material costs, labor expenses and fee for serving as the general contractor.

The Board has determined that other than the transactions described in the preceding paragraphs, no transactions occurred since the beginning of 2007 involving any director, director nominee or executive officer of the Company, any known 5% shareholder of the Company or any immediate family member of any of the foregoing persons that would require disclosure as a “related person transaction”.

NASDAQ Marketplace Rule 5630(a) requires that we conduct an appropriate review of related party transactions for potential conflict of interest situations on an ongoing basis, and all such transactions must be approved by our Audit Committee or another independent body of the Board of Directors.

Our Code of Conduct requires all officers to make full written disclosure to the CEO and the Board of Directors and obtain written approval from the CEO of all proposed outside employment, directorships or fiduciary appointments. Directors, or a business in which the Director is a partner, significant shareholder, director or executive officer, may provide services to us or to our customers in a transaction with us, subject to disclosure to and approval by the CEO and subject to disclosure to and approval by the Board of Directors when the CEO reasonably believes there is the potential for a material conflict between our interests and the Director’s or his client’s interests. In the case of a transaction with a family member, or a business in which the family member is a partner, significant shareholder, director or executive officer, relating to service or product supplier or otherwise, prior approval by the Board of Directors and competitive pricing are required. If it relates to a family member of an employee (and not a member of senior management), CEO approval may substitute for approval by the Board of Directors.

To identify related party transactions, each year, we submit and require our directors and officers to complete Director and Officer Questionnaires identifying any transaction with us or any of our subsidiaries in which the officer or director or their family members have an interest.

SHAREHOLDER PROPOSALS

New Jersey corporate law requires that the notice of shareholders’ meeting (for either a regular or special meeting) specify the purpose or purposes of the meeting. Thus, any substantive proposal, including shareholder proposals, must be referred to in the Company’s notice of shareholders’ meeting for the proposal to be properly considered at a shareholders’ meeting.

Proposals of shareholders which are eligible under SEC rules to be included in the Company’s 2011 proxy materials must be received by the Corporate Secretary of the Company no later than December 18, 2010.

If the Company changes the date of its 2011 Annual Meeting to a date more than 30 days from the anniversary of the date of its 2010 Annual Meeting, then the deadline for submission of shareholder proposals will be changed to a reasonable time before the Company begins to print and mail its proxy materials. If the Company changes the date of its 2011 annual meeting in a manner that alters the deadline, the Company will so state under Part II, Item 5 of the first quarterly report on Form 10-Q it files with the SEC after the date change, or will notify its shareholders by another reasonable method.

Under our bylaws, written notice of shareholder nominations to the Board of Directors must be delivered to the Company’s Secretary not less than 90 nor more than 120 days prior to the first anniversary of the preceding year’s Annual Meeting. Accordingly, any shareholder who wishes to have a nomination considered at the 2011 annual meeting must deliver a written notice (containing the information specified in our bylaws regarding the shareholder and the proposed action) to the Company’s Secretary between January 19, 2011 and February 18, 2011.

OTHER MATTERS

As of the date of this proxy statement, the Board of Directors knows of no business that will be presented for consideration at the Annual Meeting other than the items referred to above. Proxies in the enclosed form will be voted in respect of any other business that is properly brought before the Annual Meeting as recommended by the Board of Directors or, if no such recommendation is given, in the discretion of the proxy holders.

Shareholders are urged to sign the enclosed proxy, which is solicited on behalf of the Board, and return it in the enclosed envelope.

	By Order of the Board of Directors


	William D. Moss
	President and Chief Executive Officer

A copy of the annual report to shareholders for the fiscal year ended December 31, 2009 accompanies this proxy statement. The annual report is a combined report with the Company’s Annual Report on Form 10-K (without exhibits) for the year ended December 31, 2009 filed with the SEC. The Company will provide copies of the exhibits to the Form 10-K upon payment of a reasonable fee, upon receipt of a request addressed to the Corporate Secretary, Community Partners Bancorp, 1250 Highway 35 South, Middletown, New Jersey 07748.

PLEASE MARK VOTES

AS IN THIS EXAMPLE

REVOCABLE PROXY

COMMUNITY PARTNERS BANCORP

					For		With- hold		For All Except
Proxy Solicited on Behalf of the Board of Directors for the Annual Meeting of Shareholders on May 18, 2010		1.	To vote for the following nominees for election as director of the Company:		o		o		o

The undersigned hereby appoints Alan B. Turner and Michael J. Gormley and each of them, with full power of substitution, as attorneys and proxies for the undersigned, to attend the 2010 Annual Meeting of Shareholders of Community Partners Bancorp (the “Company”), to be held at the Hilton Woodbridge, located at 120 Wood Avenue South, Iselin, New Jersey, on Tuesday, May 18, 2010, at 10:00 a.m. Eastern Time, or any adjournment thereof, and to vote the number of shares of common stock of the Company that the undersigned would be entitled to vote, and with all the power the undersigned would possess, if personally present, as follows:			CHARLES T. PARTON JOSEPH F.X. O’SULLIVAN MICHAEL W. KOSTELNIK ROBERT E. GREGORY ROBERT B. GROSSMAN JOHN E. HOLOBINKO	WILLIAM F. LAMORTE WILLIAM D. MOSS FRANK J. PATOCK JOHN J. PERRI WILLIAM STATTER ROBIN ZAGER
			INSTRUCTION: To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the name(s) of such nominee(s) in the space provided below.

		For	Against	Abstain
2.	Ratify selection of ParenteBeard LLC as independent registered public accounting firm of the Company.	o	o	o
3.	To approve, on a non-binding basis, the compensation of the Company’s named executive officers as determined by the Compensation Committee.	o	o	o
4.	In their discretion, on the conduct of other business if properly raised.

	Please be sure to date and sign this proxy card in the box below.		Date		If this proxy is properly signed and is not revoked, the proxies will vote as specified herein or, if a choice is not specified, they will vote “FOR” the nominees listed in Item 1, “FOR” the proposal set forth in Item 2, “FOR” the non-binding approval of the compensation of the Company’s named executive officers listed in Item 3, and in their discretion on the conduct of other business if properly raised.
	Sign above		Co-holder (if any) sign above

Detach above card, sign, date and mail in postage paid envelope provided.

COMMUNITY PARTNERS BANCORP

Please sign exactly as your names appear hereon, indicating, where proper, official position or representative capacity.

PLEASE ACT PROMPTLY

SIGN, DATE & MAIL YOUR PROXY CARD TODAY

IF YOUR ADDRESS HAS CHANGED, PLEASE CORRECT THE ADDRESS IN THE SPACE PROVIDED BELOW AND RETURN THIS PORTION WITH THE PROXY IN THE ENVELOPE PROVIDED.