10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2009

Commission file number 001-34096

BRIDGE BANCORP, INC.

(Exact name of registrant as specified in its charter)

NEW YORK	11-2934195
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification Number)
2200 MONTAUK HIGHWAY, BRIDGEHAMPTON, NEW YORK	11932
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (631) 537-1000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o Accelerated filer þ Non-accelerated filer o Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No þ

There were 6,225,501 shares of common stock outstanding as of August 4, 2009.

BRIDGE BANCORP, INC.

PART I — FINANCIAL INFORMATION
Item 1. Financial Statements	1
Consolidated Balance Sheets as of June 30, 2009 and December 31, 2008	1
Consolidated Statements of Income for the Three months and Six months ended June 30, 2009 and 2008	2
Consolidated Statements of Stockholders’ Equity for the Six months ended June 30, 2009	3
Consolidated Statements of Cash Flows for the Six months ended June 30, 2009 and 2008	4
Condensed Notes to Consolidated Financial Statements	5
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3. Quantitative and Qualitative Disclosures About Market Risk	29
Item 4. Controls and Procedures	30
PART II — OTHER INFORMATION
Item 1. Legal Proceedings	31
Item 1A. Risk Factors	31
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	31
Item 3. Defaults Upon Senior Securities	31
Item 4. Submission of Matters to a Vote of Security Holders	31
Item 5. Other Information	31
Item 6. Exhibits and Reports on Form 8-K	31
Signatures	32
Exhibit 3.2 Revised By-laws of the Registrant
Exhibit 10.2 Amended and Restated Employment Agreement
Exhibit 31.1 Certification of Principal Executive Officer pursuant to Rule 13a-14(a)
Exhibit 31.2 Certification of Principal Financial Officer pursuant to Rule 13a-14(a)
Exhibit 32.1 Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(b) and 18 U.S.C. Section 1350

Item 1. Financial Statements

BRIDGE BANCORP, INC. AND SUBSIDIARY

Consolidated Balance Sheets (unaudited)

(In thousands, except share and per share amounts)

	June 30,			December 31,
	2009			2008
ASSETS
Cash and due from banks	$	12,382		$	24,744
Interest earning deposits with banks		3,666			4,141
Total cash and cash equivalents		16,048			28,885
Securities available for sale, at fair value		262,277			310,695
Securities held to maturity (fair value of $44,177 and $43,890, respectively)		43,623			43,444
Total securities, net		305,900			354,139
Securities, restricted		1,205			3,800
Loans		446,562			429,683
Allowance for loan losses		(5,023	)		(3,953	)
Loans, net		441,539			425,730
Premises and equipment, net		19,608			18,377
Accrued interest receivable		3,424			3,626
Other assets		5,485			4,502
Total Assets	$	793,209		$	839,059
LIABILITIES AND STOCKHOLDERS’ EQUITY
Demand deposits	$	206,148		$	181,213
Savings, NOW and money market deposits		341,855			344,860
Certificates of deposit of $100,000 or more		84,965			78,165
Other time deposits		66,739			54,847
Total deposits		699,707			659,085
Federal funds purchased and Federal Home Loan Bank overnight borrowings		10,000			70,900
Federal Home Loan Bank term advances		—			30,000
Repurchase agreements		15,000			15,000
Accrued interest payable		677			672
Other liabilities and accrued expenses		8,872			7,263
Total Liabilities		734,256			782,920
Stockholders’ equity:
Preferred stock, par value $.01 per share (2,000,000 shares authorized; none issued)		—			—
Common stock, par value $.01 per share:
Authorized: 20,000,000 shares; 6,386,306 issued; 6,219,978 and 6,184,080 shares outstanding, respectively		64			64
Surplus		20,008			20,452
Retained earnings		41,453			40,081
Less: Treasury Stock at cost, 166,328 and 202,226 shares, respectively		(5,565	)		(6,309	)
		55,960			54,288
Accumulated other comprehensive income (loss):
Net unrealized gain on securities, net of deferred taxes of ($2,974) and ($2,250), respectively		4,517			3,417
Change in pension liabilities, net of deferred taxes of $1,032 and $1,060, respectively		(1,524	)		(1,566	)
Total Stockholders’ Equity		58,953			56,139
Total Liabilities and Stockholders’ Equity	$	793,209		$	839,059

See accompanying condensed notes to the Unaudited Consolidated Financial Statements.

Page 1

BRIDGE BANCORP, INC. AND SUBSIDIARY

Consolidated Statements of Income (unaudited)

(In thousands, except per share amounts)

	For the three months ended June 30,					For the six months ended June 30,
	2009		2008			2009		2008
Interest income:
Loans (including fee income)	$	7,323	$	6,906		$	14,543	$	13,763
Mortgage-backed securities		2,816		1,875			5,854		3,476
State and municipal obligations		544		446			1,107		898
U.S. GSE securities		173		260			373		511
Federal funds sold		8		70			9		100
Deposits with banks		—		1			1		4
Total interest income		10,864		9,558			21,887		18,752
Interest expense:
Savings, NOW and money market deposits		903		1,325			1,880		2,902
Certificates of deposit of $100,000 or more		536		523			1,018		1,054
Other time deposits		395		254			755		577
Federal funds purchased and repurchase agreements		101		120			221		231
Federal Home Loan Bank Advances		—		26			1		30
Total interest expense		1,935		2,248			3,875		4,794
Net interest income		8,929		7,310			18,012		13,958
Provision for loan losses		1,400		325			2,300		525
Net interest income after provision for loan losses		7,529		6,985			15,712		13,433
Non interest income:
Service charges on deposit accounts		805		805			1,435		1,504
Fees for other customer services		415		437			741		775
Title fee income		153		317			360		695
Net securities gains		529		—			529		—
Other operating income		23		50			39		81
Total non interest income		1,925		1,609			3,104		3,055
Non interest expense:
Salaries and employee benefits		3,488		3,081			7,100		6,139
Net occupancy expense		566		440			1,148		907
Furniture and fixture expense		253		204			479		410
FDIC assessments		676		64			955		83
Other operating expenses		1,467		1,494			2,857		2,733
Total non interest expense		6,450		5,283			12,539		10,272
Income before income taxes		3,004		3,311			6,277		6,216
Income tax expense		981		1,076			2,045		2,011
Net income	$	2,023	$	2,235		$	4,232	$	4,205
Basic earnings per share	$	0.33	$	0.37		$	0.69	$	0.69
Diluted earnings per share	$	0.33	$	0.37		$	0.69	$	0.69
Comprehensive Income	$	1,663	$	(583	)	$	5,374	$	3,633

See accompanying condensed notes to the Unaudited Consolidated Financial Statements.

Page 2

BRIDGE BANCORP, INC. AND SUBSIDIARY

Consolidated Statements Stockholders’ Equity (unaudited)

(In thousands, except per share amounts)

														Accumulated
														Other
	Common					Comprehensive		Retained			Treasury			Comprehensive
	Stock		Surplus			Income		Earnings			Stock			Income		Total
Balance at December 31, 2008	$	64	$	20,452				$	40,081		$	(6,309	)	$	1,851	$	56,139
Net income							4,232		4,232								4,232
Proceeds from issuance of common stock												1					1
Stock awards granted				(920	)							920					—
Vesting of stock awards				(1	)												(1	)
Exercise of stock options, including tax benefit				173								165					338
Shares surrendered with the vesting of restricted stock and exercising stock options												(342	)				(342	)
Share based compensation expense				304													304
Cash dividend declared, $0.46 per share									(2,860	)							(2,860	)
Other comprehensive income, net of deferred taxes																	—
Change in unrealized net gains in securities available for sale, net of deferred tax effects							1,100								1,100		1,100
Adjustment to pension liability, net of deferred taxes							42								42		42
Comprehensive Income							5,374
Balance at June 30, 2009	$	64	$	20,008				$	41,453		$	(5,565	)	$	2,993	$	58,953

See accompanying condensed notes to the Unaudited Consolidated Financial Statements.

Page 3

BRIDGE BANCORP, INC. AND SUBSIDIARY

Consolidated Statements of Cash Flows (unaudited)

(In thousands)

Six months ended June 30,	2009			2008
Operating activities:
Net Income	$	4,232		$	4,205
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for loan losses		2,300			525
Depreciation and amortization		695			594
Amortization and (accretion), net		37			(23	)
Share based compensation expense		304			197
SERP expense		140			83
Net securities gains		(529	)		—
Decrease (increase) in accrued interest receivable		202			(393	)
Increase in other assets		(983	)		(1,463	)
Increase in accrued and other liabilities		784			2,951
Net cash provided by operating activities		7,182			6,676
Investing Activities:
Purchases of securities available for sale		(21,910	)		(99,551	)
Purchases of FHLB stock		(19,514	)		(21,776	)
Purchases of securities held to maturity		(26,113	)		(3,783	)
Proceeds from sales of securities available for sale		13,087			—
Redemption of FHLB stock		22,109			22,505
Maturities and calls of securities available for sale		27,230			25,215
Maturities of securities held to maturity		22,683			5,234
Principal payments on mortgage-backed securities		35,578			14,072
Net increase in loans		(18,109	)		(24,699	)
Purchase of premises and equipment		(1,926	)		(552	)
Net cash provided by (used in) investing activities		33,115			(83,335	)
Financing Activities:
Net increase in deposits		40,622			108,886
Net (decrease) increase in federal funds purchased and FHLB overnight borrowings		(60,900	)		10,300
Net decrease in FHLB term advances		(30,000	)		(10,000	)
Net decrease in repurchase agreements		—			(10,000	)
Proceeds from issuance of common stock		1			—
Repurchase of surrendered stock from exercise of stock options and vesting of restricted stock awards		(5	)		—
Cash dividends paid		(2,852	)		(2,820	)
Net cash (used in) provided by financing activities		(53,134	)		96,366
Net (decrease) increase in cash and cash equivalents		(12,837	)		19,707
Cash and cash equivalents at beginning of period		28,885			14,348
Cash and cash equivalents at end of period	$	16,048		$	34,055
Supplemental Information-Cash Flows:
Cash paid for:
Interest	$	3,870		$	4,822
Income tax	$	1,205		$	2,030
Noncash investing and financing activities:
Securities which settled in the subsequent period	$	—		$	3,000
Dividends declared and unpaid at end of period	$	1,431		$	1,413

See accompanying condensed notes to the Unaudited Consolidated Financial Statements.

Page 4

BRIDGE BANCORP, INC. AND SUBSIDIARY

CONDENSED NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. BASIS OF PRESENTATION

Bridge Bancorp, Inc. (the “Company”) is incorporated under the laws of the State of New York as a bank holding company. The Company’s business currently consists of the operations of its wholly-owned subsidiary, The Bridgehampton National Bank (the “Bank”). The Bank’s operations include its real estate investment trust subsidiary, Bridgehampton Community, Inc. (“BCI”) and a financial title insurance subsidiary, Bridge Abstract LLC (“Bridge Abstract”).

The accompanying Unaudited Consolidated Financial Statements, which include the accounts of the Company and its wholly-owned subsidiary, the Bank, have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. The Unaudited Consolidated Financial Statements included herein reflect all normal recurring adjustments that are, in the opinion of management, necessary for a fair presentation of the results for the interim periods presented. In preparing the interim financial statements, management has made estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reported periods. Such estimates are subject to change in the future as additional information becomes available or previously existing circumstances are modified. Actual future results could differ significantly from those estimates. The annualized results of operations for the six months ended June 30, 2009 are not necessarily indicative of the results of operations that may be expected for the entire fiscal year. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission. Certain reclassifications have been made to prior year amounts, and the related discussion and analysis, to conform to the current year presentation. The Unaudited Consolidated Financial Statements should be read in conjunction with the Audited Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2008.

2. EARNINGS PER SHARE

Basic earnings per common share is computed by dividing net income by the weighted-average number of common shares outstanding for the period. Diluted earnings per share, which reflect the potential dilution that could occur if outstanding stock options were exercised and dilutive stock awards were fully vested and resulted in the issuance of common stock that then shared in the earnings of the Company, is computed by dividing net income by the weighted average number of common shares and common stock equivalents.

Computation of Per Share Income
(in thousands, except per share data)

	Three months ended				Six months ended
	June 30,				June 30,
	2009		2008		2009		2008
Net Income	$	2,023	$	2,235	$	4,232	$	4,205
Common Equivalent Shares:
Weighted Average Common Shares Outstanding		6,091		6,076		6,090		6,076
Weighted Average Common Equivalent Shares Outstanding		30		18		19		18
Weighted Average Common and Equivalent Shares Outstanding		6,121		6,094		6,109		6,094
Basic Earnings per Share	$	0.33	$	0.37	$	0.69	$	0.69
Diluted Earnings per Share	$	0.33	$	0.37	$	0.69	$	0.69

There were approximately 55,505 and 61,705 options outstanding at June 30, 2009 and June 30, 2008, respectively, that were not included in the computation of diluted earnings per share because the options’ exercise prices were greater than the average market price of common stock and were, therefore, antidilutive. There were approximately 17,500 and 59,070 shares of unvested restricted stock at June 30, 2009 and June 30, 2008, respectively, that were not included in the computation of diluted earnings per share because they were antidilutive.

Page 5

3. REPURCHASE STOCK

The Company’s Board of Directors approved a stock repurchase program on March 27, 2006 that authorized the repurchase of up to 309,000 shares or approximately 5% of its total issued and outstanding common shares. These shares can be purchased from time to time in the open market or through private purchases, depending on market conditions, availability of stock, the trading price of the stock, alternative uses for capital, and the Company’s financial performance. Repurchased shares are held in the Company’s treasury account and may be utilized for general corporate purposes.

For the six months ended June 30, 2009 and June 30, 2008, the Company did not repurchase any of its common shares. At June 30, 2009, 167,041 shares were available for repurchase under the Board approved program.

4. STOCK BASED COMPENSATION PLANS

The Compensation Committee of the Board of Directors determines stock options and restricted stock awarded under the Bridge Bancorp, Inc. Equity Incentive Plan (“Plan”) and the Company accounts for this plan under FAS 123(R).

No new grants of stock options were awarded during the six months ended June 30, 2009 and June 30, 2008. Compensation expense attributable to stock options was $10,000 and $21,000 for the three months and six months ended June 30, 2009, respectively, and $10,000 and $18,000 for the three months and six months ended June 30, 2008, respectively.

The intrinsic value for stock options is calculated based on the exercise price of the underlying awards and the market price of our common stock as of the reporting date. The intrinsic value of options exercised during the second quarter of 2009 and 2008 was $175,000 and $0, respectively. The intrinsic value of options outstanding and exercisable at June 30, 2009 and June 30, 2008 was $149,000 and $225,000, respectively.

A summary of the status of the Company’s stock options as of and for the six months ended June 30, 2009 is as follows:

						Weighted
				Weighted		Average
	Number			Average		Remaining	Aggregate
	of			Exercise		Contractual	Intrinsic
	Options			Price		Life	Value
Outstanding, December 31, 2008		81,205		$	22.67
Granted		—			—
Exercised		(19,400	)	$	17.40
Forfeited		—			—
Expired		—			—
Outstanding, June 30, 2009		61,805		$	24.32	6.35 years	$	187,111
Vested or expected to vest		58,250		$	24.27	6.28 years	$	180,106
Exercisable, June 30, 2009		41,995		$	23.86	5.96 years	$	149,060
	Number of			Exercise
Range of Exercise Prices	Options			Price
		1,800		$	12.53
		4,500		$	15.47
		5,659		$	24.00
		44,443		$	25.25
		3,000		$	26.55
		2,403		$	30.60
		61,805

During the six months ended June 30, 2009 and June 30, 2008, restricted stock awards of 29,392 shares and 42,470 shares were granted, respectively. These awards vest over five years with a third vesting after three years, four years and five years from the date of grant. Compensation expense attributable to restricted stock awards was $134,000 and $272,000 for the three months and six months ended June 30, 2009, respectively, and $107,000 and $177,000 for the three months and six months ended June 30, 2008, respectively.

Page 6

A summary of the status of the Company’s unvested restricted stock as of and for the six months ended June 30, 2009 is as follows:

				Weighted
				Average Grant-Date
	Shares			Fair Value
Unvested, December 31, 2008		95,570		$	21.55
Granted		29,392		$	18.99
Vested		(500	)	$	26.55
Forfeited		—			—
Unvested, June 30, 2009		124,462		$	20.93

In April 2009, the Company adopted a Directors Deferred Compensation Plan. Under the Plan, independent directors may elect to defer all or a portion of their annual retainer fee in the form of restricted stock units. These restricted stock units vest ratably over one year and have dividend rights but no voting rights. In connection with this Plan, the Company recorded an expense of approximately $11,000 for the three and six months ended June 30, 2009.

5. SECURITIES

The following table summarizes the amortized cost and fair value of the available-for-sale and held-to-maturity investment securities portfolio at June 30, 2009 and December 31, 2008 and the corresponding amounts of unrealized gains and losses therein:

	June 30, 2009
			Gross		Gross			Estimated
	Amortized		Unrealized		Unrealized			Fair
(In thousands)	Cost		Gains		Losses			Value
Available for sale:
U.S. GSE securities	$	23,555	$	208	$	(43	)	$	23,720
State and municipal obligations		41,811		1,219		(42	)		42,988
Mortgage-backed securities and collateralized mortgage obligations		189,420		6,181		(32	)		195,569
Total available for sale		254,786		7,608		(117	)		262,277
Held to maturity:
State and municipal obligation		27,576		82		(117	)		27,541
Mortgage-backed securities and collateralized mortgage obligations		16,047		589		—			16,636
Total held to maturity		43,623		671		(117	)		44,177
Total securities	$	298,409	$	8,279	$	(234	)	$	306,454

	December 31, 2008
			Gross		Gross			Estimated
	Amortized		Unrealized		Unrealized			Fair
(In thousands)	Cost		Gains		Losses			Value
Available for sale:
U.S. GSE securities	$	29,855	$	306	$	(27	)	$	30,134
State and municipal obligations		47,848		840		(100	)		48,588
Mortgage-backed securities and collateralized mortgage obligations		227,325		4,731		(83	)		231,973
Total available for sale		305,028		5,877		(210	)		310,695
Held to maturity:
State and municipal obligation		24,153		68		(4	)		24,217
Mortgage-backed securities and collateralized mortgage obligations		19,291		382		—			19,673
Total held to maturity		43,444		450		(4	)		43,890
Total securities	$	348,472	$	6,327	$	(214	)	$	354,585

Page 7

The following table sets forth the fair value, amortized costs and maturities at June 30, 2009. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	June 30, 2009
	Amortized		Fair
(In thousands)	Cost		Value
Maturity
Available for sale:
Within one year	$	7,912	$	8,028
One to five years		49,227		50,209
Five to ten years		47,914		49,147
Beyond ten years		149,733		154,893
Total	$	254,786	$	262,277
Held to maturity:
Within one year	$	9,331	$	9,379
One to five years		17,716		17,641
Five to ten years		529		521
Beyond ten years		16,047		16,636
Total	$	43,623	$	44,177

Securities with unrealized losses at June 30, 2009 and December 31, 2008, aggregated by category and length of time that individual securities have been in a continuous unrealized loss position, are as follows:

	Less than 12 months				Greater than 12 months				Total
June 30, 2009			Unrealized				Unrealized				Unrealized
(In thousands)	Fair Value		losses		Fair Value		losses		Fair Value		losses
Available for sale:
U.S. GSE securities	$	8,718	$	43	$	—	$	—	$	8,718	$	43
State and municipal obligations		1,416		15		722		27		2,138		42
Mortgage-backed securities and collateralized mortgage obligations		1,363		32		—		—		1,363		32
Total available for sale	$	11,497	$	90	$	722	$	27	$	12,219	$	117
Held to maturity:
State and municipal obligations	$	11,628	$	117	$	—	$	—	$	11,628	$	117
Mortgage-backed securities and collateralized mortgage obligations		—		—		—		—		—		—
Total held to maturity	$	11,628	$	117	$	—	$	—	$	11,628	$	117

	Less than 12 months				Greater than 12 months				Total
December 31, 2008			Unrealized				Unrealized				Unrealized
(In thousands)	Fair Value		losses		Fair Value		losses		Fair Value		losses
Available for sale:
U.S. GSE securities	$	4,319	$	27	$	—	$	—	$	4,319	$	27
State and municipal obligations		2,160		51		701		49		2,861		100
Mortgage-backed securities and collateralized mortgage obligations		17,224		64		1,529		19		18,753		83
Total available for sale	$	23,703	$	142	$	2,230	$	68	$	25,933	$	210
Held to maturity:
State and municipal obligations	$	3,996	$	4	$	—	$	—	$	3,996	$	4
Mortgage-backed securities and collateralized mortgage obligations		—		—		—		—		—		—
Total held to maturity	$	3,996	$	4	$	—	$	—	$	3,996	$	4

Page 8

Other-Than-Temporary-Impairment

Management evaluates securities for other-than-temporary impairment (“OTTI”) at least on a quarterly basis, and more frequently when economic or market conditions warrant such an evaluation. The investment securities portfolio is evaluated for OTTI by segregating the portfolio into two general segments and applying the appropriate OTTI model. Investment securities classified as available for sale or held-to-maturity are generally evaluated for OTTI under Statement of Financial Accounting Standards (“SFAS”) No. 115, Accounting for Certain Investments in Debt and Equity Securities. In determining OTTI under the SFAS No. 115 model, management considers many factors, including: (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, (3) whether the market decline was affected by macroeconomic conditions, and (4) whether the Company has the intent to sell the debt security or more likely than not will be required to sell the debt security before its anticipated recovery. The assessment of whether an other-than-temporary decline exists involves a high degree of subjectivity and judgment and is based on the information available to management at a point in time.

At June 30, 2009, the majority of unrealized losses are related to the Company’s State and municipal obligations. The securities represent New York State and local municipalities with underlying ratings of A or better and include municipal bond insurance. Because the decline in fair value is attributable to changes in interest rates and not credit quality, and because the Company does not have the intent to sell these securities and it is likely that it will not be required to sell the securities before their anticipated recovery, the Company does not consider these securities to be other-than-temporarily impaired at June 30, 2009.

Proceeds from sales and calls of securities available for sale were $12.6 million and $2.0 million for the three months ended June 30, 2009 and 2008, respectively. Proceeds from sales and calls of securities available for sale were $32.6 million and $2.4 million for the six months ended June 30, 2009 and 2008, respectively. Gross gains of $0.5 million were realized on these sales during the three and six months ended June 30, 2009. There were no securities gains or losses during the three and six months ended June 30, 2008.

Securities having a fair value of approximately $151.4 million and $276.0 million at June 30, 2009 and December 31, 2008, respectively, were pledged to secure public deposits and Federal Home Loan Bank and Federal Reserve Bank overnight borrowings. The Bank did not hold any trading securities during the six months ended June 30, 2009 or the year ended December 31, 2008.

The Bank is a member of the Federal Home Loan Bank (“FHLB”) of New York. Members are required to own a particular amount of stock based on the level of borrowings and other factors, and may invest in additional amounts. The Bank is also a member of the Federal Reserve Bank (“FRB”) system and required to own FRB stock. FHLB and FRB stock is carried at cost and periodically evaluated for impairment based on ultimate recovery of par value. Both cash and stock dividends are reported as income. The Bank owned approximately $1.2 million in FHLB and FRB stock at June 30, 2009 and $3.8 million at December 31, 2008, respectively and reported these amounts as restricted securities in the consolidated balance sheets.

6. ESTIMATED FAIR VALUE OF FINANCIAL INSTRUMENTS

Statement of Financial Accounting Standards (“SFAS”) No. 157 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. SFAS No. 157 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair values:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The fair value of securities available for sale is determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs) or matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs).

Page 9

Assets and Liabilities Measured on a Recurring Basis:

			Fair Value Measurements at
			June 30, 2009 Using:
				Significant
			Quoted Prices In	Other		Significant
			Active Markets for	Observable		Unobservable
	Carrying		Identical Assets	Inputs		Inputs
(In thousands)	Value		(Level 1)	(Level 2)		(Level 3)
Financial Assets:
Available for sale securities
U.S. GSE securities	$	23,720		$	23,720
State and municipal obligations		42,988			42,988
Mortgage-backed securities and collateralized mortgage obligations		195,569			195,569
Total available for sale	$	262,277		$	262,277

			Fair Value Measurements at
			December 31, 2008 Using:
				Significant
			Quoted Prices In	Other		Significant
			Active Markets for	Observable		Unobservable
	Carrying		Identical Assets	Inputs		Inputs
(In thousands)	Value		(Level 1)	(Level 2)		(Level 3)
Financial Assets:
Available for sale securities
U.S. GSE securities	$	30,134		$	30,134
State and municipal obligations		48,588			48,588
Mortgage-backed securities and collateralized mortgage obligations		231,973			231,973
Total available for sale	$	310,695		$	310,695

Fair value estimates are made at specific points in time and are based on existing on-and off-balance sheet financial instruments. Such estimates are generally subjective in nature and dependent upon a number of significant assumptions associated with each financial instrument or group of financial instruments, including estimates of discount rates, risks associated with specific financial instruments, estimates of future cash flows, and relevant available market information. Changes in assumptions could significantly affect the estimates. In addition, fair value estimates do not reflect the value of anticipated future business, premiums or discounts that could result from offering for sale at one time the Bank’s entire holdings of a particular financial instrument, or the tax consequences of realizing gains or losses on the sale of financial instruments.

The Company used the following method and assumptions in estimating the fair value of its financial instruments:

Cash and Due from Banks and Federal Funds Sold: Carrying amounts approximate fair value, since these instruments are either payable on demand or have short-term maturities.

Securities Available for Sale and Held to Maturity: The estimated fair values are based on independent dealer quotations on nationally recognized securities exchanges or matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities.

Page 10

Restricted Stock: It is not practicable to determine the fair value of FHLB and FRB stock due to restrictions placed on its transferability.

Loans: The estimated fair values of real estate mortgage loans and other loans receivable are based on discounted cash flow calculations that use available market benchmarks when establishing discount factors for the types of loans. All nonaccrual loans are carried at their current fair value. Exceptions may be made for adjustable rate loans (with resets of one year or less), which would be discounted straight to their rate index plus or minus an appropriate spread.

Deposits: The estimated fair value of certificates of deposits are based on discounted cash flow calculations that use a replacement cost of funds approach to establishing discount rates for certificates of deposits maturities. Stated value is fair value for all other deposits.

Borrowed Funds and Brokered Deposits: The estimated fair value of borrowed funds and wholesale certificates of deposit are based on discounted cash flow calculations that use a replacement cost of funds approach to establishing discount rates for funding maturities.

Accrued Interest Receivable and Payable: For these short-term instruments, the carrying amount is a reasonable estimate of the fair value.

Off-Balance-Sheet Liabilities: The fair value of off-balance-sheet commitments to extend credit is estimated using fees currently charged to enter into similar agreements. The fair value is immaterial as of June 30, 2009 and December 31, 2008.

The estimated fair values and recorded carrying values of the Bank’s financial instruments are as follows:

	June 30, 2009				December 31, 2008
	Carrying		Fair		Carrying		Fair
(In thousands)	Amount		Value		Amount		Value
Financial Assets:
Cash and due from banks	$	12,382	$	12,382	$	24,744	$	24,744
Interest bearing deposits with banks		3,666		3,666		4,141		4,141
Securities available for sale		262,277		262,277		310,695		310,695
Securities restricted		1,205		—		3,800		—
Securities held to maturity		43,623		44,176		43,444		43,890
Loans, net		441,539		450,458		425,730		437,265
Accrued interest receivable		3,424		3,424		3,626		3,626
Financial liabilities:
Demand and other deposits		699,707		701,186		659,085		660,176
Federal funds purchased and Federal Home Loan Bank overnight borrowings		10,000		9,998		70,900		70,882
Federal Home Loan Bank term advances		—		—		30,000		29,998
Repurchase agreements		15,000		16,014		15,000		15,368
Accrued interest payable		677		677		672		672

Page 11

7. LOANS

The following table sets forth the major classifications of loans:

(In thousands)	June 30, 2009			December 31, 2008
Commercial real estate mortgage loans	$	217,797		$	199,156
Residential real estate mortgage loans		141,351			139,342
Commercial, financial, and agricultural loans		67,167			63,468
Installment/consumer loans		10,912			11,081
Real estate-construction loans		9,087			16,370
Total loans		446,314			429,417
Net deferred loan costs and fees		248			266
		446,562			429,683
Allowance for loan losses		(5,023	)		(3,953	)
Net loans	$	441,539		$	425,730

The principal business of the Bank is lending, primarily in commercial real estate loans, residential mortgage loans, construction loans, home equity loans, commercial and industrial loans, land loans and consumer loans. The Bank considers its primary lending area to be eastern Long Island in Suffolk County, New York, and a substantial portion of the Bank’s loans are secured by real estate in this area. Accordingly, the ultimate collectibility of such a loan portfolio is susceptible to changes in market and economic conditions in this region.

Nonaccrual loans at June 30, 2009 and December 31, 2008 were $2.3 million and $3.1 million, respectively. There were no loans 90 days or more past due that were still accruing at June 30, 2009 and December 31, 2008.

As of June 30, 2009 and December 31, 2008, the Company had impaired loans as defined by SFAS No. 114, “Accounting by Creditors for Impairment of a Loan — An Amendment of FASB Statement No. 5 and 15” (“SFAS 114”) of $4.8 million and $5.7 million, respectively. Impaired loans include individually classified nonaccrual loans and trouble debt restructured (“TDR”) loans. Recognition of interest income on impaired loans is discontinued when reasonable doubt exists as to the ultimate collectability of the interest and principal of the loan. The TDR loans of $3.2 million at June 30, 2009 and December 31, 2008 are current and are secured with collateral that has a fair value of approximately $5.4 million as well as personal guarantors. Management believes that the ultimate collection of principal and interest is reasonably assured and therefore continues to recognize interest income on an accrual basis. In addition, the Bank has no commitment to lend additional funds to this debtor. The average recorded investment in the impaired loan during the six months ended June 30, 2009 was $5.7 million and was $0.8 million for the year ended December 31, 2008. There were no impaired loans as of June 30, 2008. At June 30, 2009 and December 31, 2008, there was no specifically allocated allowance for loan losses related to impaired loans.

The Bank had no foreclosed real estate at June 30, 2009, December 31, 2008 and June 30, 2008, respectively.

8. ALLOWANCE FOR LOAN LOSSES

The Company monitors its entire loan portfolio on a regular basis, with consideration given to detailed analyses of classified loans, repayment patterns, probable incurred losses, past loss experience, current economic conditions, and various types of concentrations of credit. Additions to the allowance are charged to expense and realized losses, net of recoveries, are charged to the allowance. Based on the determination of management and the Classification Committee, the overall level of reserves is periodically adjusted to account for the inherent and specific risks within the entire portfolio. Based on the Classification Committee’s review of the classified loans and the overall reserve levels as they relate to the entire loan portfolio at June 30, 2009 and December 31, 2008, the Company determined the allowance for loan losses to be adequate.

Page 12

The following table sets forth changes in the allowance for loan losses:

	For the Six Months Ended						For the Year Ended
(In thousands)	June 30, 2009			June 30, 2008			December 31, 2008
Beginning balance	$	3,953		$	2,954		$	2,954
Provision for loan loss		2,300			525			2,000
Net charge-offs		(1,230	)		(155	)		(1,001	)
Ending balance	$	5,023		$	3,324		$	3,953

9. EMPLOYEE BENEFITS

The Bank maintains a noncontributory pension plan through the New York State Bankers Association Retirement System covering all eligible employees.

The Bridgehampton National Bank Supplemental Executive Retirement Plan (“SERP”) provides benefits to certain employees, as recommended by the Compensation Committee of the Board of Directors and approved by the full Board of Directors, whose benefits under the Pension Plan are limited by the applicable provisions of the Internal Revenue Code. The benefit under the SERP is equal to the additional amount the employee would be entitled to under the Pension Plan and the 401(k) Plan in the absence of such Internal Revenue Code limitations. The assets of the SERP are held in a rabbi trust to maintain the tax-deferred status of the plan and are subject to the general, unsecured creditors of the Company. As a result, the assets of the trust are reflected on the Consolidated Balance Sheets of the Company. The effective date of the SERP was January 1, 2001.

The Company made a $400,000 contribution to the pension plan during the six months ended June 30, 2009. There were no contributions made to the SERP during the six months ended June 30, 2009. The Company does not anticipate making any additional contributions to the pension plan or the SERP through the end of the year.

The Company’s funding policy with respect to its benefit plans is to contribute at least the minimum amounts required by applicable laws and regulations.

The following table sets forth the components of net periodic benefit cost and other amounts recognized in Other Comprehensive Income:

	Three months ended June 30,										Six months ended June 30,
	Pension Benefits						SERP Benefits				Pension Benefits						SERP Benefits
(In thousands)	2009			2008			2009		2008		2009			2008			2009		2008
Service cost	$	120		$	110		$	40	$	18	$	238		$	220		$	80	$	35
Interest cost		80			70			15		12		158			139			29		24
Expected return on plan assets		(129	)		(124	)		—		—		(256	)		(247	)		—		—
Amortization of net loss		22			—			3		—		44			—			7		—
Amortization of unrecognized prior service cost		2			2			—		—		4			4			—		—
Amortization of unrecognized transition obligation		—			—			7		6		—			—			14		13
Net periodic benefit cost	$	95		$	58		$	65	$	36	$	188		$	116		$	130	$	72

10. SECURITIES SOLD UNDER AGREEMENTS TO REPURCHASE

At June 30, 2009, December 31, 2008 and June 30, 2008 securities sold under agreements to repurchase totaled $15.0 million and were secured by mortgage-backed securities with a carrying amount of $21.5 million, $23.4 million and $21.5 million, respectively.

Securities sold under agreements to repurchase are financing arrangements with $5.0 million maturing during the first quarter of 2013 and $10.0 million maturing during the first quarter of 2015. At maturity, the securities underlying the agreements are returned to the Company.

Page 13

Information concerning the securities sold under agreements to repurchase is summarized as follows:

	For the six months ended						For the year ended
(Dollars in thousands)	June 30, 2009			June 30, 2008			December 31, 2008
Average daily balance	$	15,000		$	11,346		$	13,183
Average interest rate		2.34	%		2.27	%		2.39	%
Maximum month-end balance	$	15,000		$	15,000		$	15,000
Weighted average interest rate		2.34	%		2.27	%		2.39	%

11. FEDERAL HOME LOAN BANK ADVANCES AND OVERNIGHT BORROWINGS

As of June 30, 2009, there were no term advances or overnight borrowings outstanding from the Federal Home Loan Bank. As of December 31, 2008, there was one term advance from the Federal Home Loan Bank for $30.0 million with a fixed interest rate of 0.49% that matured in January 2009. The term advance was payable at its maturity date and was subject to a prepayment penalty. The term advance was collateralized by $35.3 million of mortgage-backed securities as of December 31, 2008. In addition to the term advance, there was $34.9 million of overnight borrowings from the Federal Home Loan Bank outstanding as of December 31, 2008. The overnight borrowings were collateralized by $15.8 million of securities and a blanket lien on residential mortgages as of December 31, 2008. As of June 30, 2008 there was $17.3 million of overnight borrowings outstanding from the Federal Home Loan Bank. The overnight borrowings were collateralized by a blanket lien on residential mortgages as of June 30, 2008.

12. SUBSEQUENT EVENTS

As defined in FAS 165, subsequent events are events or transactions that occur after the balance sheet date but before financial statements are issued or available to be issued. Financial statements are considered issued when they are widely distributed to shareholders and other financial statement users for general use and reliance in a form and format that complies with GAAP. The Company has evaluated subsequent events through August 6, 2009, which is the date that the Company’s financial statements are being issued.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Private Securities Litigation Reform Act Safe Harbor Statement

This report may contain statements relating to the future results of the Company (including certain projections and business trends) that are considered “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995 (the “PSLRA”). Such forward-looking statements, in addition to historical information, which involve risk and uncertainties, are based on the beliefs, assumptions and expectations of management of the Company. Words such as “expects,” “believes,” “should,” “plans,” “anticipates,” “will,” “potential,” “could,” “intend,” “may,” “outlook,” “predict,” “project,” “would,” “estimates,” “assumes,” “likely,” and variations of such similar expressions are intended to identify such forward-looking statements. Examples of forward-looking statements include, but are not limited to, possible or assumed estimates with respect to the financial condition, expected or anticipated revenue, and results of operations and business of the Company, including earnings growth; revenue growth in retail banking, lending and other areas; origination volume in the Company’s consumer, commercial and other lending businesses; current and future capital management programs; non-interest income levels, including fees from the abstract subsidiary and banking services as well as product sales; tangible capital generation; market share; expense levels; and other business operations and strategies. For this presentation, the Company claims the protection of the safe harbor for forward-looking statements contained in the PSLRA.

Factors that could cause future results to vary from current management expectations include, but are not limited to: changes in economic conditions including an economic recession that could affect the value of real estate collateral and the ability for borrowers to repay their loans; legislative and regulatory changes, including increases in FDIC insurance rates; monetary and fiscal policies of the federal government; changes in tax policies, rates and regulations of federal, state and local tax authorities; changes in interest rates; deposit flows; the cost of funds; demand for loan products and other financial services; competition; changes in the quality and composition of the Bank’s loan and investment portfolios; changes in management’s business strategies; changes in accounting principles, policies or guidelines; changes in real estate values and other factors discussed elsewhere in this report, factors set forth under Item 1A., Risk Factors, in our Annual Report on Form 10-K for the year ended December 31, 2008 and in other reports filed by the Company with the Securities and Exchange Commission. The forward-looking statements are made as of the date of this report, and the Company assumes no obligation to update the forward-looking statements or to update the reasons why actual results could differ from those projected in the forward-looking statements.

Page 14

Overview

Who We Are and How We Generate Income

Bridge Bancorp, Inc. (“the Company”), a New York corporation, is a bank holding company formed in 1989. On a parent-only basis, the Company has had minimal results of operations. The Company is dependent on dividends from its wholly owned subsidiary, The Bridgehampton National Bank (“the Bank”), its own earnings, additional capital raised, and borrowings as sources of funds. The information in this report reflects principally the financial condition and results of operations of the Bank. The Bank’s results of operations are primarily dependent on its net interest income, which is mainly the difference between interest income on loans and investments and interest expense on deposits and borrowings. The Bank also generates non interest income, such as fee income on deposit accounts and merchant credit and debit card processing programs, income from its title abstract subsidiary, and net gains on sales of securities and loans. The level of its non interest expenses, such as salaries and benefits, occupancy and equipment costs, other general and administrative expenses, expenses from its title insurance subsidiary, and income tax expense, further affects the Bank’s net income. Certain reclassifications have been made to prior year amounts and the related discussion and analysis to conform to the current year presentation.

Quarterly Highlights

• Net income of $2.0 million or $.33 per diluted share, including an expense of $.4 million or $.04 per diluted share for a FDIC special assessment for the second quarter of 2009, as compared to net income of $2.2 million or $.37 per diluted share for the second quarter in 2008.

• Returns on average assets and equity of .99% and 14.72%, respectively, which includes the effect of the FDIC special assessment.

• Net interest income increased to $8.9 million for the second quarter of 2009 compared to $7.3 million in 2008.

• A net interest margin of 4.78% for the second quarter of 2009 compared to 4.76% for 2008.

• Total loans at June 30, 2009 of $446.6 million, an increase of $16.9 million or 3.9% over December 31, 2008 and an increase of $46.8 million or 11.7% over June 30, 2008.

• Total assets of $793.2 million at June 30, 2009, a decrease of $45.9 million or 5.5% compared to December 31, 2008 and an increase of $83.0 million or 11.7% compared to June 30, 2008.

• Deposits of $699.7 million, an increase of $40.6 million or 6.2% over December 31, 2008 and an increase of $81.9 million or 13.3% compared to June 30, 2008 levels.

• The opening of a 15^th branch, in Shirley, NY.

• The addition of the Company’s shares to the Russell 3000^® stock market index.

• Announced a Dividend Reinvestment Plan and declared quarterly dividend of $.23 per share.

Principal Products and Services and Locations of Operations

The Bank operates fifteen branches on eastern Long Island. Federally chartered in 1910, the Bank was founded by local farmers and merchants. For nearly a century, the Bank has maintained its focus on building customer relationships in this market area. The mission of the Company is to grow through the provision of exceptional service to its customers, its employees, and the community. The Company strives to achieve excellence in financial performance and build long term shareholder value. The Bank engages in full service commercial and consumer banking business, including accepting time, savings and demand deposits from the consumers, businesses and local municipalities surrounding its branch offices. These deposits, together with funds generated from operations and borrowings, are invested primarily in: (1) commercial real estate loans; (2) home equity loans; (3) construction loans; (4) residential mortgage loans; (5) secured and unsecured commercial and consumer loans; (6) FHLB, FNMA, GNMA and FHLMC mortgage-backed securities and collateralized mortgage obligations; (7) New York State and local municipal obligations; and (8) U.S. government sponsored entity (“U.S. GSE”) securities. The Bank also offers the CDARS program, providing up to $50,000,000 of FDIC insurance to its customers. In addition, the Bank offers merchant credit and debit card processing, automated teller machines, cash management services, lockbox processing, online banking services, safe deposit boxes, individual retirement accounts and investment services through Bridge Investment Services, offering a full range of investment products and services through a third party broker dealer. Through its title insurance abstract subsidiary, the Bank acts as a broker for title insurance services. The Bank’s customer base is comprised principally of small businesses, municipal relationships and consumer relationships.

Page 15

Significant Events

On February 27, 2009, the FDIC issued a final rule, effective April 1, 2009, to change the way that the FDIC’s assessment system differentiates for risk and to set new assessment rates beginning with the second quarter of 2009. In May 2009, the FDIC issued a final rule to impose an emergency special assessment of 5 basis points on all banks based on their total assets less tier one capital as of June 30, 2009. The special assessment is payable on September 30, 2009. During the second quarter of 2009, the Company recorded an expense of $375,000 related to the FDIC special assessment.

Opportunities and Challenges

The economic and competitive landscape has changed dramatically over the past two years. Recognizing that our market areas are generally affluent, large money center banks increasingly meet their funding needs by aggressively pricing deposits in the Bank’s markets. Competition for deposits and loans is intense as various banks in the marketplace, large and small, promise excellent service yet often price their products aggressively. Deposit growth is essential to the Bank’s ability to increase earnings; therefore branch expansion and building share in our existing markets remain key strategic goals. Controlling funding costs yet protecting the deposit base along with focusing on profitable growth, presents a unique set of challenges in this operating environment.

Since the second half of 2007 and continuing through 2009, the financial markets experienced significant volatility resulting from the continued fallout of sub-prime lending and the global liquidity crises. A multitude of government initiatives along with eight rate cuts by the Federal Reserve totaling 500 basis points have been designed to improve liquidity for the distressed financial markets. The ultimate objective of these efforts has been to help the beleaguered consumer, and reduce the potential surge of residential mortgage loan foreclosures and stabilize the banking system. Despite these actions, many of our competitors, due to liquidity concerns, have not yet fully adjusted their deposit pricing. This contrasts with the impact on assets where yields on loans and securities have declined. The squeeze between declining asset yields and more slowly declining liability pricing could impact margins.

Growth and service strategies have the potential to offset the tighter net interest margin with volume as the customer base grows through expanding the Bank’s footprint, while maintaining and developing existing relationships. Since 2007, the Bank has opened four new branches. In January 2007, the Bank opened in the Village of Southampton; in February 2007, in Cutchogue; and in September 2007, the Bank opened a new branch in Wading River. In April 2009, the Bank opened a new branch in Shirley, New York. The opening of the branch facilities in Wading River and Shirley, move the Bank geographically westward and demonstrate our commitment to traditional growth through branch expansion.

In April 2008, the Bank received approval from the Office of the Comptroller of the Currency (“OCC”) and expects that the opening of the new full service branch facility in the Village of East Hampton will be a fourth quarter 2009 event. In addition, in November 2008, the Bank received OCC approval to open a branch in Deer Park, New York, and the Bank anticipates opening the location during the fourth quarter of 2009. In July 2009, the Company received OCC approval to open a new branch in Center Moriches, New York.

The Bank routinely adds to its menu of products and services, continually meeting the needs of consumers and businesses. We believe positive outcomes in the future will result from the expansion of our geographic footprint, investments in infrastructure and technology, such as BridgeNEXUS, our remote deposit capture product as well as the introduction of lockbox processing in the fourth quarter of 2008, and continued focus on placing our customers first. In January 2009, the Bank launched Bridge Investment Services, offering a full range of investment products and services through a third party broker dealer.

Corporate objectives for 2009 include: leveraging our expanding branch network to build customer relationships and grow loans and deposits; focusing on opportunities and processes that continue to enhance the customer experience at the Bank; improving operational efficiencies and prudent management of non-interest expense; and maximizing non-interest income through Bridge Abstract as well as other lines of business. The ability to attract, retain, train and cultivate employees at all levels of the Company remains significant to meeting these objectives. The Company has made great progress toward the achievement of these objectives, and avoided many of the problems facing other financial institutions as a result of maintaining discipline in its underwriting, expansion strategies, investing and general business practices. The Company has capitalized on opportunities presented by the market in 2008 and continues during 2009 to diligently seek opportunities for growth and to strengthen the franchise. The causes of the current economic crisis are many and have occurred over a prolonged period and therefore cannot be expected to be resolved in days, weeks or months. The Company recognizes the potential risks of the current economic environment and will monitor the impact of market events as we consider growth initiatives and evaluate loans and investments.

Page 16

Critical Accounting Policies

Allowance for Loan Losses

We consider the accounting policy on the allowance for loan losses to be the most critical and requires complex management judgment as discussed below. The judgments made regarding the allowance for loan losses can have a material effect on the results of operations of the Company.

The allowance for loan losses is established and maintained through a provision for loan losses based on probable incurred losses inherent in the Bank’s loan portfolio. We evaluate the adequacy of the allowance on a quarterly basis. The allowance is comprised of both individual valuation allowances and loan pool valuation allowances. If the allowance for loan losses is not sufficient to cover actual loan losses, the Company’s earnings could decrease.

The Bank monitors its entire loan portfolio on a regular basis, with consideration given to detailed analysis of classified loans, repayment patterns, probable incurred losses, past loss experience, current economic conditions, and various types of concentrations of credit. Additions to the allowance are charged to expense and realized losses, net of recoveries, are charged to the allowance.

Individual valuation allowances are established in connection with specific loan reviews and the asset classification process including the procedures for impairment testing under Statement of Financial Accounting Standard (“SFAS”) No. 114, “Accounting by Creditors for Impairment of a Loan, an Amendment of FASB Statements No. 5 and 15,” and SFAS No. 118, “Accounting by Creditors for Impairment of a Loan — Income Recognition and Disclosures, an Amendment of SFAS No. 114.” Such valuation, which includes a review of loans for which full collectibility in accordance with contractual terms is not reasonably assured, considers the estimated fair value of the underlying collateral less the costs to sell, if any, or the present value of expected future cash flows, or the loan’s observable market value. Any shortfall that exists from this analysis results in a specific allowance for the loan. Pursuant to our policy, loan losses must be charged-off in the period the loans, or portions thereof, are deemed uncollectible. Assumptions and judgments by management, in conjunction with outside sources, are used to determine whether full collectibility of a loan is not reasonably assured. These assumptions and judgments also are used to determine the estimates of the fair value of the underlying collateral or the present value of expected future cash flows or the loan’s observable market value. Individual valuation allowances could differ materially as a result of changes in these assumptions and judgments. Individual loan analyses are periodically performed on specific loans considered impaired. The results of the individual valuation allowances are aggregated and included in the overall allowance for loan losses.

Loan pool valuation allowances represent loss allowances that have been established to recognize the inherent risks associated with our lending activities, but which, unlike individual allowances, have not been allocated to particular problem assets. Pool evaluations are broken down as follows: first, loans with homogenous characteristics are pooled by loan type and include home equity loans, residential mortgages, land loans and consumer loans. Then all remaining loans are segregated into pools based upon the risk rating of each credit. Key factors in determining a credit’s risk rating include management’s evaluation of: cash flow, collateral, guarantor support, financial disclosures, industry trends and strength of borrowers’ management. The determination of the adequacy of the valuation allowance is a process that takes into consideration a variety of factors. The Bank has developed a range of valuation allowances necessary to adequately provide for probable incurred losses inherent in each pool of loans. We consider our own charge-off history along with the growth in the portfolio as well as the Bank’s credit administration and asset management philosophies and procedures when determining the allowances for each pool. In addition, we evaluate and consider the impact that economic and market conditions may have on the portfolio as well as known and inherent risks in the portfolio. Finally, we evaluate and consider the allowance ratios and coverage percentages of both peer group and regulatory agency data. These evaluations are inherently subjective because, even though they are based on objective data, it is management’s interpretation of that data that determines the amount of the appropriate allowance. If the evaluations prove to be incorrect, the allowance for loan losses may not be sufficient to cover losses inherent in the loan portfolio, resulting in additions to the allowance for loan losses.

The Classification Committee is comprised of members of both management and the Board of Directors. The adequacy of the allowance is analyzed quarterly, with any adjustment to a level deemed appropriate by the Classification Committee, based on its risk assessment of the entire portfolio. Based on the Classification Committee’s review of the classified loans and the overall allowance levels as they relate to the entire loan portfolio at June 30, 2009, management believes the allowance for loan losses has been established at levels sufficient to cover the probable incurred losses in the Bank’s loan portfolio. Future additions or reductions to the allowance may be necessary based on changes in economic, market or other conditions. Changes in estimates could result in a material change in the allowance. In addition, various regulatory agencies, as an integral part of the examination process, periodically review the allowance for loan losses. Such agencies may require the Bank to recognize adjustments to the allowance based on their judgments of the information available to them at the time of their examination.

Page 17

Comparison of Operating Results

Net Income

Net income for the three months ended June 30, 2009 was $2.0 million or $0.33 per diluted share as compared to $2.2 million or $0.37 per diluted share for the same period in 2008. Changes for the three months ended June 30, 2009 compared to June 30, 2008 include: (i) $1.6 million or 22.1% increase in net interest income; (ii) $0.3 million or 19.6% increase in total non interest income as a result of net securities gains of $0.5 million, partially offset by lower fee income for customer services and lower title insurance revenues; (iii) $1.2 million or 22.1% increase in total non interest expenses, primarily due to a $0.4 million increase in salaries and employee benefits related to increased staffing and greater incentive based compensation, a $0.6 million increase in other operating expenses primarily related to higher FDIC insurance premiums including the special assessment of $0.4 million and higher occupancy costs associated with new branches. In addition, a provision for loan losses of $1.4 million was recorded this quarter due to the continued growth of our loan portfolio as well as our assessment of risk factors considering the weakening economic environment and overall industry trends. Non interest income for the three months ended June 30, 2008 did not include any net securities losses. The effective income tax rate was 32.7% for the quarter ended June 30, 2009 compared to 32.5% for the same period last year.

Net income was unchanged at $4.2 million or $0.69 per diluted share for the six months ended June 30, 2009 and 2008, however the following fluctuations did occur: (i) $4.1 million or 29.0% increase in net interest income; (ii) a provision for loan losses of $2.3 million was recorded in 2009 compared to $0.5 million in 2008 due to the continued growth of our loan portfolio and changes in economic conditions, (iii) $49,000 or 1.6% increase in total non interest income as a result of net securities gains of $0.5 million partially offset by lower service charges on deposit accounts and fees on customer services and lower title insurance income and merchant income, and (iv) $2.3 million or 22.1% increase in total non interest expenses, primarily due to a $1.0 million increase in salaries and employee benefits related to higher staff levels associated with expanding the Company’s infrastructure and the opening of new branch offices and higher incentive based compensation, and a $1.0 million increase in other operating expenses primarily related to higher FDIC insurance premiums related to growth in deposits, higher rates and the special assessment. The effective income tax rate increased to 32.6% from 32.4% for the same period last year.

Analysis of Net Interest Income

Net interest income, the primary contributor to earnings, represents the difference between income on interest earning assets and expenses on interest bearing liabilities. Net interest income depends upon the volume of interest earning assets and interest bearing liabilities and the interest rates earned or paid on them.

The following tables set forth certain information relating to the Company’s average consolidated balance sheets and its consolidated statements of income for the periods indicated and reflect the average yield on assets and average cost of liabilities for the periods indicated. Such yields and costs are derived by dividing income or expense by the average balance of assets or liabilities, respectively, for the periods shown. Average balances are derived from daily average balances and include nonaccrual loans. The yields and costs include fees, which are considered adjustments to yields. Interest on nonaccrual loans has been included only to the extent reflected in the consolidated statements of income. For purposes of this table, the average balances for investments in debt and equity securities exclude unrealized appreciation/depreciation due to the application of SFAS No. 115, “Accounting for Certain Investments in Debt and Equity Securities.”

Page 18

Three months ended June 30,	2009								2008
(In thousands)						Average								Average
	Average					Yield/			Average					Yield/
	Balance		Interest			Cost			Balance		Interest			Cost
Interest earning assets:
Loans, net (including loan fee income)	$	441,236	$	7,323			6.66	%	$	393,886	$	6,906			7.05	%
Mortgage-backed securities		226,806		2,816			4.98			153,366		1,875			4.92
Tax exempt securities (1)		70,090		836			4.78			52,695		653			4.98
Taxable securities		21,141		173			3.28			22,207		260			4.71
Federal funds sold		10,618		8			0.30			13,438		70			2.10
Deposits with banks		3,601		—			—			128		1			3.14
Total interest earning assets		773,492		11,156			5.79			635,720		9,765			6.18
Non interest earning assets:
Cash and due from banks		14,217								16,330
Other assets		29,322								26,494
Total assets	$	817,031							$	678,544
Interest bearing liabilities:
Savings, NOW and money market deposits	$	374,189	$	903			0.97	%	$	304,329	$	1,325			1.75	%
Certificates of deposit of $100,000 or more		83,430		536			2.58			62,202		523			3.38
Other time deposits		69,095		395			2.29			32,846		254			3.11
Federal funds purchased and repurchase agreements		32,593		101			1.24			20,773		120			2.32
Federal Home Loan Bank term advances		—		—			—			4,615		26			2.27
Total interest bearing liabilities		559,307		1,935			1.39			424,765		2,248			2.13
Non interest bearing liabilities:
Demand deposits		196,522								196,945
Other liabilities		6,088								4,347
Total liabilities		761,917								626,057
Stockholders’ equity		55,114								52,487
Total liabilities and stockholders’ equity	$	817,031							$	678,544
Net interest income/interest rate spread (2)				9,221			4.40	%				7,517			4.05	%
Net interest earning assets/net interest margin (3)	$	214,185					4.78	%	$	210,955					4.76	%
Ratio of interest earning assets to interest bearing liabilities							138.29	%							149.66	%
Less: Tax equivalent adjustment				(292	)							(207	)
Net interest income			$	8,929							$	7,310

(1)	The above table is presented on a tax equivalent basis.
(2)	Net interest rate spread represents the difference between the yield on average interest earning assets and the cost of average interest bearing liabilities.
(3)	Net interest margin represents net interest income divided by average interest earning assets.

Page 19

Six months ended June 30,	2009								2008
(In thousands)						Average								Average
	Average					Yield/			Average					Yield/
	Balance		Interest			Cost			Balance		Interest			Cost
Interest earning assets:
Loans, net (including loan fee income)	$	435,233	$	14,543			6.74	%	$	386,136	$	13,763			7.17	%
Mortgage-backed securities		234,825		5,854			5.03			142,425		3,476			4.91
Tax exempt securities (1)		70,076		1,700			4.89			53,013		1,328			5.04
Taxable securities		18,519		373			4.06			22,762		511			4.51
Federal funds sold		6,059		9			0.30			8,743		100			2.30
Deposits with banks		3,019		1			0.07			153		4			5.26
Total interest earning assets		767,731		22,480			5.90			613,232		19,182			6.29
Non interest earning assets:
Cash and due from banks		13,982								16,473
Other assets		28,790								26,826
Total assets	$	810,503							$	656,531
Interest bearing liabilities:
Savings, NOW and money market deposits	$	370,823	$	1,880			1.02	%	$	299,122	$	2,902			1.95	%
Certificates of deposit of $100,000 or more		81,759		1,018			2.51			58,878		1,054			3.60
Other time deposits		64,574		755			2.36			34,039		577			3.41
Federal funds purchased and repurchase agreements		42,610		221			1.05			17,735		231			2.62
Federal Home Loan Bank term advances		166		1			1.21			2,473		30			2.44
Total interest bearing liabilities		559,932		3,875			1.40			412,247		4,794			2.34
Non interest bearing liabilities:
Demand deposits		189,899								186,610
Other liabilities		5,295								4,439
Total liabilities		755,126								603,296
Stockholders’ equity		55,377								53,235
Total liabilities and stockholders’ equity	$	810,503							$	656,531
Net interest income/interest rate spread (2)				18,605			4.50	%				14,388			3.95	%
Net interest earning assets/net interest margin (3)	$	207,799					4.89	%	$	200,985					4.72	%
Ratio of interest earning assets to interest bearing liabilities							137.11	%							148.75	%
Less: Tax equivalent adjustment				(593	)							(430	)
Net interest income			$	18,012							$	13,958

(1)	The above table is presented on a tax equivalent basis.
(2)	Net interest rate spread represents the difference between the yield on average interest earning assets and the cost of average interest bearing liabilities.
(3)	Net interest margin represents net interest income divided by average interest earning assets.

Page 20

Rate/Volume Analysis

Net interest income can be analyzed in terms of the impact of changes in rates and volumes. The following table illustrates the extent to which changes in interest rates and in the volume of average interest earning assets and interest bearing liabilities have affected the Bank’s interest income and interest expense during the periods indicated. Information is provided in each category with respect to (i) changes attributable to changes in volume (changes in volume multiplied by prior rate); (ii) changes attributable to changes in rates (changes in rates multiplied by prior volume); and (iii) the net changes. For purposes of this table, changes which are not due solely to volume or rate changes have been allocated to these categories based on the respective percentage changes in average volume and rate. Due to the numerous simultaneous volume and rate changes during the periods analyzed, it is not possible to precisely allocate changes between volume and rates. In addition, average earning assets include nonaccrual loans.

	Three months ended June 30,									Six months ended June 30,
	2009 Over 2008									2009 Over 2008
	Changes Due To									Changes Due To
(In thousands)	Volume			Rate			Net Change			Volume			Rate			Net Change
Interest income on interest earning assets:
Loans, net (including loan fee income)	$	2,407		$	(1,990	)	$	417		$	2,785		$	(2,005	)	$	780
Mortgage-backed securities		917			24			941			2,292			86			2,378
Tax exempt securities (1)		351			(168	)		183			483			(111	)		372
Taxable securities		(12	)		(75	)		(87	)		(90	)		(48	)		(138	)
Federal funds sold		(12	)		(50	)		(62	)		(24	)		(67	)		(91	)
Deposits with banks		3			(4	)		(1	)		12			(15	)		(3	)
Total interest earning assets		3,654			(2,263	)		1,391			5,458			(2,160	)		3,298
Interest expense on interest bearing liabilities:
Savings, NOW and money market deposits		1,474			(1,896	)		(422	)		1,518			(2,540	)		(1,022	)
Certificates of deposit of $100,000 or more		598			(585	)		14			701			(737	)		(36	)
Other time deposits		548			(407	)		140			665			(487	)		178
Federal funds purchased and repurchase agreements		237			(256	)		(19	)		384			(394	)		(10	)
Federal Home Loan Bank Advances		(13	)		(13	)		(26	)		(19	)		(10	)		(29	)
Total interest bearing liabilities		2,844			(3,157	)		(313	)		3,249			(4,168	)		(919	)
Net interest income	$	810		$	894		$	1,704		$	2,209		$	2,008		$	4,217

(1) The above table is presented on a tax equivalent basis.

Analysis of Net Interest Income for the Three Months ended June 30, 2009 and June 30, 2008

Net interest income was $8.9 million for the three months ended June 30, 2009 compared to $7.3 million for the same period in 2008, an increase of $1.6 million or 22.1%. Net interest margin improved to 4.78% for the quarter ended June 30, 2009 as compared to 4.76% for the quarter ended June 30, 2008. This increase was primarily the result of an increase in average interest earnings assets of $137.8 million and the decrease in the cost of the average total interest bearing liabilities being greater than the decrease in the yield on average total interest earning assets. The cost of interest bearing liabilities decreased approximately 74 basis points during the second quarter of 2009 compared to 2008, which was partly offset by a decrease in yields of approximately 39 basis points on interest earning assets.

For the three months ended June 30, 2009, average loans grew by $47.4 million or 12.0% to $441.2 million as compared to $393.9 million for the same period in 2008. Real estate mortgage loans and commercial loans primarily contributed to the growth. The Bank remains committed to growing loans with prudent underwriting, sensible pricing and limited credit and extension risk.

For the three months ended June 30, 2009, average total investments increased by $89.7 million or 39.3% to $318.0 million as compared to $228.3 million for the three months ended June 30, 2008. Average federal funds sold decreased to $10.6 million or 20.9% for the three months ended June 30, 2009 from $13.4 million in 2008. The decrease in the average federal funds sold for the three months ended June 30, 2009 was primarily due to growth in the average investments.

Page 21

Average total interest bearing liabilities totaled $559.3 million for the three months ended June 30, 2009 compared to $424.8 million for the same period in 2008. During the three months ended June 30, 2009, the Bank reduced interest rates on deposit products in response to the reductions in the federal funds and discount rate by the Federal Reserve and the prudent management of deposit pricing. The reduction in deposit rates along with lower borrowing costs resulted in a decrease in the cost of interest bearing liabilities from 2.13% for the three months ended June 30, 2008 to 1.39% for the same period in 2009. Since the Company’s interest bearing liabilities generally reprice or mature more quickly than its interest earning assets, a decrease in short term interest rates initially result in an increase in net interest income. Additionally, the large percentages of deposits in money market accounts reprice at short term market rates making the balance sheet more liability sensitive.

For the three months ended June 30, 2009, average total deposits increased by $126.9 million or 21.3% to $723.2 million as compared to average total deposits of $596.3 million for the same period in 2008. Components of this increase include an increase in average balances in savings, NOW and money market accounts of $69.9 million or 23.0% to $374.2 million for the three months ended June 30, 2009 compared to $304.3 million for the same period last year. Average balances in certificates of deposit of $100,000 or more and other time deposits increased $57.5 million or 60.5% to $152.5 million for 2009 as compared to 2008. Average public fund deposits comprised 19.1% of total average deposits during the three months ended June 30, 2009 and 22.0% of total average deposits for the same period in 2008. Average federal funds purchased and repurchase agreements and average Federal Home Loan Bank advances increased $7.2 million to $32.6 million for the three months ended June 30, 2009 as compared to $25.4 million for the same period in the prior year.

Total interest income increased $1.3 million or 13.7% to $10.9 million for the three months ended June 30, 2009 from $9.6 million for the same period in 2008. Interest income on loans increased $0.4 million or 6.0% to $7.3 million in 2009 compared to $6.9 million in 2008 primarily due to growth in the loan portfolio partially offset by a decrease in yield on average loans. The yield on average loans was 6.7% for 2009 as compared to 7.1% in 2008.

Interest income on investment in mortgage-backed, taxable and tax exempt securities increased $0.9 million to $3.5 million for the three months ended June 30, 2009 compared to $2.6 million for the same period in 2008. Interest income on securities included net amortization of premium of $46,000 in the 2009 period compared to accretion of discounts of $22,000 for the same period in 2008. The tax adjusted average yield on total securities decreased to 4.8% in 2009 from 4.9% in 2008.

Interest expense decreased $0.3 million or 13.9% to $1.9 million for the three months ended June 30, 2009 compared to $2.2 million for the same period in 2008. The decrease in interest expense in 2009 resulted from the Federal Reserve reducing the targeted federal funds rate and discount rate at 0.25% and 0.50%, respectively and the prudent management of deposit pricing which was partially offset by the growth in average balances for deposits and borrowings.

Analysis of Net Interest Income for the Six Months ended June 30, 2009 and June 30, 2008

Net interest income was $18.0 million for the six months ended June 30, 2009 compared to $14.0 million for the same period in 2008, an increase of $4.0 million or 29.0%. Net interest margin improved to 4.89% for the six months ended June 30, 2009 as compared to 4.72% for the same period in 2008. This increase was primarily the result of an increase in average interest earnings assets of $154.5 million and the decrease in the cost of the average total interest bearing liabilities being greater than the decrease in the yield on average total interest earning assets. The cost of interest bearing liabilities decreased approximately 94 basis points during the six months ended June 30, 2009 compared to 2008, which was partly offset by a decrease in yields of approximately 39 basis points on interest earning assets.

For the six months ended June 30, 2009, average loans grew by $49.1 million or 12.7% to $435.2 million as compared to $386.1 million for the same period in 2008. Real estate mortgage loans and commercial loans primarily contributed to the growth. The Bank remains committed to growing loans with prudent underwriting, sensible pricing and limited credit and extension risk.

For the six months ended June 30, 2009, average total investments increased by $105.2 million or 48.2% to $323.4 million as compared to $218.2 million for the same period in 2008. Average federal funds sold decreased to $6.1 million or 30.7% for the six months ended June 30, 2009 from $8.7 million in 2008. The decrease in the average federal funds sold for the three months ended June 30, 2009 was primarily due to growth in the average investments.

Average total interest bearing liabilities totaled $559.9 million for the six months ended June 30, 2009 compared to $412.2 million for the same period in 2008. During the six months ended June 30, 2009, the Bank reduced interest rates on deposit products in response to the reductions in the federal funds and discount rate by the Federal Reserve and the prudent management of deposit pricing. The reduction in deposit rates along with lower borrowing costs resulted in a decrease in the cost of interest bearing liabilities from 2.34% for the six months ended June 30, 2008 to 1.40% for the same period in 2009. Since the Company’s interest bearing liabilities generally reprice or mature more quickly than its interest earning assets, a decrease in short term interest rates initially result in an increase in net interest income. Additionally, the large percentages of deposits in money market accounts reprice at short term market rates making the balance sheet more liability sensitive.

Page 22

For the six months ended June 30, 2009, average total deposits increased by $128.5 million or 22.2% to $707.1 million as compared to average total deposits of $578.6 million for the same period in 2008. Components of this increase include an increase in average balances in savings, NOW and money market accounts of $71.7 million or 24.0% to $370.8 million for the six months ended June 30, 2009 compared to $299.1 million for the same period last year. Average balances in certificates of deposit of $100,000 or more and other time deposits increased $53.4 million or 57.5% to $146.3 million for 2009 as compared to $92.9 million in 2008. Average public fund deposits comprised 20.7% of total average deposits during the six months ended June 30, 2009 and 23.2% of total average deposits for the same period in 2008. Average federal funds purchased and repurchase agreements and average Federal Home Loan Bank advances increased $22.6 million to $42.8 million for the six months ended June 30, 2009 as compared to $20.2 million for the same period in the prior year.

Total interest income increased $3.1 million or 16.7% to $21.9 million for the six months ended June 30, 2009 from $18.8 million for the same period in 2008. Interest income on loans increased $0.8 million or 5.7% to $14.5 million in 2009 compared to $13.8 million in 2008 primarily due to growth in the loan portfolio partially offset by a decrease in yield on average loans. The yield on average loans was 6.7% for 2009 as compared to 7.2% in 2008.

Interest income on investment in mortgage-backed, taxable and tax exempt securities increased $2.4 million to $7.3 million for the six months ended June 30, 2009 compared to $4.9 million for the same period in 2008. Interest income on securities included net amortization of premium of $37,000 in the 2009 period compared to accretion of discounts of $23,000 for the same period in 2008. The tax adjusted average yield on total securities stayed flat at 4.9% for the six months ended June 30, 2009 and 2008, respectively.

Interest expense decreased $0.9 million or 19.2% to $3.9 million for the six months ended June 30, 2009 compared to $4.8 million for the same period in 2008. The decrease in interest expense in 2009 resulted from the Federal Reserve reducing the targeted federal funds rate and discount rate to 0.25% and 0.50%, respectively and the prudent management of deposit pricing which was partially offset by the growth in average balances for deposits and borrowings.

Provision and Allowance for Loan Losses

The Bank’s loan portfolio consists primarily of real estate loans secured by commercial and residential real estate properties located in the Bank’s principal lending area on eastern Long Island. The interest rates charged by the Bank on loans are affected primarily by the demand for such loans, the supply of money available for lending purposes, the rates offered by its competitors, the Bank’s relationship with the customer and the related credit risks of the transaction. These factors are affected by general and economic conditions including, but not limited to, monetary policies of the federal government, including the Federal Reserve Board, legislative policies and governmental budgetary matters.

The performance of the loan portfolio remained strong for the three months ended June 30, 2009. Non performing assets were $2.3 million at June 30, 2009 compared to $3.1 million at December 31, 2008 and $0.8 million at June 30, 2008 representing 0.52% of total loans at June 30, 2009 compared to 0.71% at December 31, 2008 and 0.19% at June 30, 2008. As of June 30, 2009 and December 31, 2008, the Company had impaired loans as defined by SFAS No. 114, “Accounting by Creditors for Impairment of a Loan — An Amendment of FASB Statement No. 5 and 15” (“SFAS 114”) of $4.8 million and $5.7 million, respectively. Impaired loans include individually classified nonaccrual loans and trouble debt restructured (“TDR”) loans. Recognition of interest income on impaired loans is discontinued when reasonable doubt exists as to the ultimate collectability of the interest and principal of the loan. The TDR loans of $3.2 million at June 30, 2009 and December 31, 2008 are current and are secured with collateral that has a fair value of approximately $5.4 million as well as personal guarantors. Management believes that the ultimate collection of principal and interest is reasonably assured and therefore continues to recognize interest income on an accrual basis. In addition, the Bank has no commitment to lend additional funds to this debtor. The average recorded investment in the impaired loan during the six months ended June 30, 2009 was $5.7 million and was $0.8 million for the year ended December 31, 2008. There were no impaired loans as of June 30, 2008. At June 30, 2009 and December 31, 2008, there was no specifically allocated allowance for loan losses related to impaired loans.

The Bank had no foreclosed real estate at June 30, 2009, December 31, 2008 and June 30, 2008, respectively.

Loans of approximately $15.3 million or 3.4% of total loans at June 30, 2009 were classified as potential problem loans compared to $12.1 million or 2.7% at March 31, 2009, $3.5 million or 0.8% at December 31, 2008 and $12.3 million or 3.1% at June 30, 2008. These are loans for which management has information that indicates the borrower may not be able to comply with the present repayment terms. These loans are subject to increased management attention and their classification is reviewed on at least a quarterly basis. Due to the structure and nature of the credits, we do not expect to sustain a loss on these relationships.

Page 23

Based on our continuing review of the overall loan portfolio, the current asset quality of the portfolio, the growth in our loan portfolio, and the net charge-offs, a provision for loan losses of $1.4 million and $2.3 million was recorded during the three and six months ended June 30, 2009 compared to a provision for loan loss of $0.3 million and $0.5 million that was recorded during the same periods in 2008. The Bank recognized net charge-offs in the amount of $1.2 million for the six months ended June 30, 2009 as compared to $0.2 million for the same period in 2008. The allowance for loan losses increased to $5.0 million at June 30, 2009, as compared to $4.0 million at December 31, 2008 and $3.3 million at June 30, 2008. As a percentage of total loans, the allowance increased to 1.12% at June 30, 2009 compared to 0.92% at December 31, 2008 and 0.83% at June 30, 2008. Management continues to carefully monitor the loan portfolio as well as real estate trends on eastern Long Island. The Bank’s consistent and rigorous underwriting standards preclude sub prime lending, and management remains cautious about the potential for an indirect impact on the local economy and real estate values in the future.

Non Interest Income

Total non interest income increased $0.3 million or 19.6% to $1.9 million for the three months ended June 30, 2009 compared to $1.6 million for the same period in 2008. Net securities gains were $0.5 million for the three months ended June 30, 2009. There were no net securities gains or losses for the three months ended June 30, 2008. Service charges on deposit accounts remained at $0.8 million for the three months ended June 30, 2009 and 2008. Fees for other customer services were $0.4 million for the three months ended June 30, 2009 and 2008, respectively. Title fee income related to Bridge Abstract decreased $164,000 or 51.7% to $153,000 for the three months ended June 30, 2009 compared to $317,000 for the same period in 2008.

Total non interest income increased during the six months ended June 30, 2009 by $49,000 or 1.6% from the same period last year. Net securities gains were $0.5 million for the six months ended June 30, 2009. There were no net securities gains or losses for the six months ended June 30, 2008. Fees for other customer services totaled $0.7 million and service charges on deposit accounts totaled $1.4 million for the six months ended June 30, 2009, compared to $0.8 million and $1.5 million, respectively, from the same period in 2008. The decline in service charges on deposit accounts represents lower overdraft fees. Bridge Abstract, the Bank’s title insurance abstract subsidiary, generated title fee income of $0.4 million during the six months ended June 30, 2009 compared to $0.7 million for the same period in 2008. The decrease was attributable to a decline in the number and value of transactions processed by the subsidiary. Other operating income for the six months ended June 30, 2009 totaled $39,000, a decrease of $42,000 from $81,000 for the six months ended June 30, 2008. The decline represents lower check book fees and bank rental income.

Non Interest Expense

Total non interest expense increased $1.2 million or 22.1% to $6.5 million during the three months ended June 30, 2009 over the same period in 2008. The primary components of these increases were higher salaries and employee benefits, net occupancy expense, furniture and fixture expense and FDIC assessments. Salary and benefit expense increased $0.4 million or 13.2% to $3.5 million for the three months ended June 30, 2009 from $3.1 million for the same periods in 2008. The increase reflects filling vacant positions, hiring new employees to support the Company’s expanding infrastructure and new branch offices, and related employee benefit costs. Net occupancy expense increased $126,000 or 28.6% to $566,000 for the three months ended June 30, 2009 from $440,000 for the same periods in 2008. Higher net occupancy expenses were due to increases in maintenance and supplies, and rent expense related to the new branch offices in 2009 as well as annual rent increases in other branch locations. Furniture and fixture expense increased $49,000 or 24.0% to $253,000 for the three months ended June 30, 2009 from $204,000 for the same period in 2008. The increase in furniture and fixture expense in 2009 relates primarily to the new branches. FDIC assessments increased $0.6 million to $0.7 million for the three months ended June 30, 2009 from $0.1 million for the same period in 2008. The increase during 2009 was due to growth in deposits, higher rates, and a special assessment of $0.4 million.

Total non interest expense increased $2.2 million or 22.1% to $12.5 million during the six months ended June 30, 2009 from $10.3 million for the same period in 2008. The primary components of these increases were higher salaries and employee benefits, net occupancy expense, furniture and fixture expense and FDIC assessments. Salary and benefit expense increased $1.0 million or 15.7% to $7.1 million for the six months ended June 30, 2009 from $6.1 million for the same period in 2008. The increases in salary and benefits reflect base salary increases for staff, filling vacant positions, hiring new employees to support the Company’s expanding infrastructure and new branch offices, increases in incentive based compensation and an increase in employee benefit costs, particularly related to pension and SERP expense. Net occupancy expense increased $0.2 million or 26.6% to $1.1 million for the six months ended June 30, 2009 from $0.9 million for the same period in 2008. Higher net occupancy expenses were due to increases in maintenance and supplies, and rent expense related to the new branch offices in 2009 as well as annual rent increases in other branch locations. Furniture and fixture expense increased $0.1 million or 16.8% to $0.5 million for the six months ended June 30, 2009 from $0.4 million for the same period in 2008. The increase in furniture and fixture expense in 2009 relates primarily to the new branches. FDIC assessments increased $0.9 million to $1.0 million for the six months ended June 30, 2009 from $0.1 million for the same period in 2008. The increase during 2009 was due to growth in deposits, higher rates, and a special assessment of $0.4 million.

Page 24

Income Taxes

The provision for income taxes decreased $0.1 million to $1.0 million during the three months ended June 30, 2009 from $1.1 million for the same period in 2008 due to lower income before income taxes. The effective tax rate for the three months ended June 30, 2009 increased to 32.7% from 32.5% for the same period last year. For the six months ended June 30, 2009 and 2008, the provision for income taxes remained at $2.0 million. The effective tax rate for the six months ended June 30, 2009 increased to 32.6% from 32.4% for the same period in 2008.

Financial Condition

Assets totaled $793.2 million at June 30, 2009, a decrease of $45.9 million or 5.5% from $839.1 million at December 31, 2008. This change is primarily a result of a decrease in total securities of $48.2 million or 13.6% due to maturities, principal payments and the sale of $12.6 million of mortgage backed securities as well as a decrease in cash and cash equivalents of $12.8 million or 44.4% which was partially offset by increases in total loans of $16.9 million or 3.9%. Total deposits grew $40.6 million to $699.7 million at June 30, 2009, compared to $659.1 million at December 31, 2008. Demand deposits increased $24.9 million to $206.1 million compared to $181.2 million at December 31, 2008. Savings, NOW and money market deposits decreased $3.0 million to $341.9 million at June 30, 2009 from $344.9 million at December 31, 2008. Certificates of deposit of $100,000 or more and other time deposits also increased $18.7 million or 14.1%. The increase in deposits and the decline in the investment portfolio resulted in a decrease in borrowings at June 30, 2009. Federal funds purchased and Federal Home Loan Bank overnight borrowings decreased $60.9 million to $10.0 million at June 30, 2009 compared to $70.9 million at December 31, 2008. There were no Federal Home Loan Bank term advances outstanding at June 30, 2009 compared to $30.0 million at December 31, 2008. Accrued interest payable and other liabilities increased $1.6 million to $9.5 million at June 30, 2009 from $7.9 million at December 31, 2008. The increase in other liabilities at June 30, 2009 relates to an increase in accrued taxes payable and an increase in deferred tax liabilities as a result of higher unrealized gains on the security portfolio.

Total stockholders’ equity was $59.0 million at June 30, 2009, an increase of $2.8 million or 5.0% from December 31, 2008, primarily due to net income of $4.2 million and an increase in net unrealized gains on securities of $1.1 million, partially offset by the declaration of dividends totaling $2.9 million.

In April 2009, the Company announced a dividend reinvestment plan effective with the second quarter 2009 dividend. In June 2009, the Company declared a quarterly dividend of $0.23 per share. The Company continues its long term trend of uninterrupted dividends.

Liquidity

The objective of liquidity management is to ensure the sufficiency of funds available to respond to the needs of depositors and borrowers, and to take advantage of unanticipated earnings enhancement opportunities for Company growth. Liquidity management addresses the ability of the Company to meet financial obligations that arise in the normal course of business. Liquidity is primarily needed to meet customer borrowing commitments, deposit withdrawals either on demand or contractual maturity, to repay other borrowings as they mature, to fund current and planned expenditures and to make new loans and investments as opportunities arise.

The Holding Company’s principal sources of liquidity included cash and cash equivalents of $5.9 million as of June 30, 2009, and dividends from the Bank. Cash available for distribution of dividends to shareholders of the Company is primarily derived from dividends paid by the Bank to the Company. During 2009, the Bank declared and paid $4.5 million in cash dividends to the Company. At June 30, 2009, the Bank had $5.6 million of retained net income available for dividends to the Company. Prior regulatory approval is required if the total of all dividends declared by the Bank in any calendar year exceeds the total of the Bank’s net income of that year combined with its retained net income of the preceding two years. In the event that the Company subsequently expands its current operations, in addition to dividends from the Bank, it will need to rely on its own earnings, additional capital raised and other borrowings to meet liquidity needs.

The Bank’s most liquid assets are cash and cash equivalents, securities available for sale and securities held to maturity due within one year. The levels of these assets are dependent upon the Bank’s operating, financing, lending and investing activities during any given period. Other sources of liquidity include principal repayments and maturities of loan and investment securities, lines of credit with other financial institutions including the Federal Home Loan Bank and the Federal Reserve Bank, growth in core deposits and sources of wholesale funding such as brokered certificates of deposits. While scheduled loan amortization, maturing securities and short term investments are a relatively predictable source of funds, deposit flows and loan and mortgage-backed securities prepayments are greatly influenced by general interest rates, economic conditions and competition. The Bank adjusts its liquidity levels as appropriate to meet funding needs such as seasonal deposit outflows, loans, and asset and liability management objectives. Historically, the Bank has relied on its deposit base, drawn through its full-service branches that serve its market area and local municipal deposits, as its principal source of funding. The Bank seeks to retain existing deposits and loans and maintain customer relationships by offering quality service and competitive interest rates to its customers, while managing the overall cost of funds needed to finance its strategies.

Page 25

The Bank’s Asset/Liability and Funds Management Policy allows for wholesale borrowings of up to 25% of total assets. At June 30, 2009, the Bank had aggregate lines of credit of $217.5 million with unaffiliated correspondent banks to provide short term credit for liquidity requirements. Of these aggregate lines of credit, $197.5 million is available on an unsecured basis. The Bank also has the ability, as a member of the Federal Home Loan Bank (“FHLB”) system, to borrow against unencumbered residential and commercial mortgages owned by the Bank. The Bank also has a master repurchase agreement with the FHLB, which increases its borrowing capacity. In addition, the Bank has an approved broker relationship for the purpose of issuing brokered certificates of deposit. As of June 30, 2009, the Bank had no brokered certificates of deposit compared to $5.0 million at December 31, 2008. As of June 30, 2009 and December 31, 2008, the Bank had $10.0 million and $70.9 million, respectively, in overnight borrowings. The Bank had $15.0 million of securities sold under agreements to repurchase outstanding as of June 30, 2009 and December 31, 2008. The Bank had a $30.0 million advance that was collateralized by securities outstanding as of December 31, 2008 with the FHLB. There were no advances outstanding as of June 30, 2009.

Management continually monitors the liquidity position and believes that sufficient liquidity exists to meet all of our operating requirements. Based on the objectives determined by the Asset and Liability Committee, the Bank’s liquidity levels may be affected by the use of short term and wholesale borrowings, and the amount of public funds in the deposit mix. The Asset and Liability Committee is comprised of members of senior management and the Board. Excess short term liquidity is invested in overnight federal funds sold.

Capital Resources

The Company and the Bank are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can result in certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s and the Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of the Company’s and Bank’s assets, liabilities, and certain off-balance sheet items calculated under regulatory accounting practices. The Company’s and the Bank’s capital amounts and classification also are subject to qualitative judgments by the regulators about components, risk weightings, and other factors.

Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios (set forth in the following table) of total and Tier 1 capital (as defined in the regulations) to risk weighted assets (as defined), and of Tier 1 capital (as defined) to average assets (as defined). As of June 30, 2009, the Company and the Bank met all capital adequacy requirements. In April 2009, the Company announced that its Board of Directors approved and adopted a Dividend Reinvestment Plan (“DRP Plan”) and filed a registration statement on Form S-3 to register 600,000 shares of common stock with the Securities and Exchange Commission (“SEC”) pursuant to the DRP Plan. In June 2009, the Company filed a shelf registration statement on Form S-3 to register up to $50 million of securities with the SEC.

Page 26

At June 30, 2009 and December 31, 2008, actual capital levels and minimum required levels for the Company and the Bank were as follows:

Bridge Bancorp, Inc. (Consolidated) As of June 30,	2009
(Dollars in thousands)											To Be Well
						For Capital					Capitalized Under
						Adequacy					Prompt Corrective
	Actual					Purposes					Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
Total Capital (to risk weighted assets)	$	61,102		11.6	%	$	41,990		8.0	%		n/a		n/a
Tier 1 Capital (to risk weighted assets)		55,960		10.7	%		20,995		4.0	%		n/a		n/a
Tier 1 Capital (to average assets)		55,960		6.9	%		32,658		4.0	%		n/a		n/a
As of December 31,	2008
(Dollars in thousands)											To Be Well
						For Capital					Capitalized Under
						Adequacy					Prompt Corrective
	Actual					Purposes					Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
Total Capital (to risk weighted assets)	$	58,360		11.1	%	$	42,137		8.0	%		n/a		n/a
Tier 1 Capital (to risk weighted assets)		54,288		10.3	%		21,068		4.0	%		n/a		n/a
Tier 1 Capital (to average assets)		54,288		6.9	%		31,304		4.0	%		n/a		n/a
As of June 30,	2009
(Dollars in thousands)											To Be Well
						For Capital					Capitalized Under
						Adequacy					Prompt Corrective
	Actual					Purposes					Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
Total Capital (to risk weighted assets)	$	56,668		10.8	%	$	41,983		8.0	%	$	52,478		10.0	%
Tier 1 Capital (to risk weighted assets)		51,526		9.8	%		20,991		4.0	%		31,487		6.0	%
Tier 1 Capital (to average assets)		51,526		6.3	%		32,655		4.0	%		40,818		5.0	%
As of December 31,	2008
(Dollars in thousands)											To Be Well
						For Capital					Capitalized Under
						Adequacy					Prompt Corrective
	Actual					Purposes					Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
Total Capital (to risk weighted assets)	$	55,431		10.5	%	$	42,130		8.0	%	$	52,662		10.0	%
Tier 1 Capital (to risk weighted assets)		51,359		9.8	%		21,065		4.0	%		31,597		6.0	%
Tier 1 Capital (to average assets)		51,359		6.6	%		31,279		4.0	%		39,099		5.0	%

Impact of Inflation and Changing Prices

The Unaudited Consolidated Financial Statements and notes thereto presented herein have been prepared in accordance with U.S. generally accepted accounting principles, which require the measurement of financial position and operating results in terms of historical dollars without considering changes in the relative purchasing power of money over time due to inflation. The primary effect of inflation on the operations of the Company is reflected in increased operating costs. Unlike most industrial companies, virtually all of the assets and liabilities of a financial institution are monetary in nature. As a result, changes in interest rates have a more significant effect on the performance of a financial institution than do the effects of changes in the general rate of inflation and changes in prices. Changes in interest rates could aversely affect our results of operations and financial condition. Interest rates do not necessarily move in the same direction, or in the same magnitude, as the prices of goods and services. Interest rates are highly sensitive to many factors, which are beyond the control of the Company, including the influence of domestic and foreign economic conditions and the monetary and fiscal policies of the United States government and federal agencies, particularly the Federal Reserve Bank.

Recent Regulatory and Accounting Developments

In June 2008, the FASB issued FSP EITF 03-6-1, “Determining Whether Instruments Granted in Shared-Based Payment Transactions Are Participating Securities”. This FSP addresses whether instruments granted in share-based payment transactions are participating securities prior to vesting and, therefore, need to be included in the earnings allocation in computing earnings per share (“EPS”). This FSP is effective for financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those years. All prior-period EPS data presented shall be adjusted retrospectively. The Company adopted this FSP for the quarter ending March 31, 2009 and determined that there was no material impact to earnings per share.

Page 27

In April 2009, the FASB issued FASB Staff Position (“FSP”) FAS 157-4, “Determining Fair Value When the Volume and Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly”. This FSP emphasizes that even if there has been a significant decrease in the volume and level of activity for the asset or liability and regardless of the valuation technique(s) used, the objective of a fair value measurement remains the same. It also provides guidance to determine whether transactions are orderly. FSP FAS 157-4 is effective for interim and annual periods ending after June 15, 2009, with early adoption permitted for periods ending after March 15, 2009, if FSP FAS 115-2 and FAS 124-2, “Recognition and Presentation of Other-Than-Temporary Impairment” and FSP FAS 107-1 and APB 28-1, “Interim Disclosures about Fair Value of Financial Instruments”, are adopted simultaneously. The adoption of this FSP did not have a significant impact on the Company’s financial statements.

In April 2009, the FASB issued FSP FAS 107-1 and APB 28-1, “Interim Disclosures about Fair Value of Financial Information”. This FSP amends FASB Statement No. 107, “Disclosures about the Fair Value of Financial Instruments” to require disclosures about fair value of financial instruments for interim reporting periods of publicly traded companies as well as in annual financial statements. This FSP also amends APB Opinion No. 28, “Interim Financial Reporting” to require those disclosures in summarized financial information at interim reporting periods. This FSP shall be effective for interim reporting periods ending after June 15, 2009, with early adoption permitted for periods ending after March 15, 2009. An entity may early adopt this FSP only if it also elects to early adopt FSP FAS 157-4, “Determining Fair Value When the Volume and Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly”, and FSP FAS 115-2 and FAS 124-2, “Recognition and Presentation of Other-Than-Temporary Impairments”. The adoption of this FSP at June 30, 2009 did not have a material impact on the results of operations or financial position as it only required disclosures which are included in Note 6.

In April 2009, the FASB issued FSP FAS 115-2 and FAS 124-2, “Recognition and Presentation of Other-Than-Temporary Impairments”. This FSP amends the other-than-temporary impairment guidance in U.S. GAAP for debt securities to make the guidance more operational and to improve the presentation and disclosure of other-than-temporary impairments on debt and equity securities in the financial statements. The FSP shall be effective for interim and annual reporting periods ending after June 15, 2009, with early adoption permitted for periods ending after March 15, 2009. Earlier adoption for periods ending before March 15, 2009, is not permitted. If an entity elects to adopt early either FSP FAS 157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly, or FSP FAS 107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments, the entity also is required to adopt early this FSP. Additionally, if an entity elects to adopt early this FSP, it is required to adopt FSP FAS 157-4. The adoption of this FSP did not have a significant impact on the Company’s financial statements.

In April 2009, the FASB issued FSP FAS 141(R)-1, “Accounting for Assets Acquired and Liabilities Assumed in a Business Combination That Arise from Contingencies”. This FSP shall be effective for assets or liabilities arising from contingencies in business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. The adoption of this FSP had no impact on the Company’s financial statements.

In May 2009, the FASB issued Statement 165 “Subsequent Events” which addresses accounting and disclosure requirements related to subsequent events. Statement 165 requires management to evaluate subsequent events through the date the financial statements are either issued or available to be issued, depending on the company’s expectation of whether it will widely distribute its financial statements to its shareholders and other financial statement users. Companies are required to disclose the date through which subsequent events have been evaluated. Statement 165 is effective for interim or annual financial periods ending after June 15, 2009 and should be applied prospectively.

In June 2009, the FASB issued Statement No. 168, “The FASB Accounting Standards Codification and the Hierarchy of Generally Accepted Accounting Principles — A Replacement of FASB Statement No. 162”. With the issuance of Statement No. 168 on June 29, 2009, the FASB Accounting Standards CodificationTM (Codification) became the source of authoritative U.S. generally accepted accounting principles (GAAP) recognized by the FASB to be applied by nongovernmental entities. Rules and interpretive releases of the Securities and Exchange Commission (SEC) under authority of federal securities laws are also sources of authoritative GAAP for SEC registrants. On the effective date of this Statement, the Codification superseded all then-existing non-SEC accounting and reporting standards. All other nongrandfathered non-SEC accounting literature not included in the Codification became nonauthoritative. This Statement is effective for financial statements issued for interim and annual periods ending after September 15, 2009.

Page 28

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Asset/Liability Management

Management considers interest rate risk to be the most significant market risk for the Company. Market risk is the risk of loss from adverse changes in market prices and rates. Interest rate risk is the exposure to adverse changes in the net income of the Company as a result of changes in interest rates.

The Company’s primary earnings source is net interest income, which is affected by changes in the level of interest rates, the relationship between rates, the impact of interest rate fluctuations on asset prepayments, the level and composition of deposits and liabilities, and the credit quality of earning assets. The Company’s objectives in its asset and liability management are to maintain a strong, stable net interest margin, to utilize its capital effectively without taking undue risks, to maintain adequate liquidity, and to reduce vulnerability of its operations to changes in interest rates.

The Company’s Asset and Liability Committee evaluates periodically, but at least four times a year, the impact of changes in market interest rates on assets and liabilities, net interest margin, capital and liquidity. Risk assessments are governed by policies and limits established by senior management, which are reviewed and approved by the full Board of Directors at least annually. The economic environment continually presents uncertainties as to future interest rate trends. The Asset and Liability Committee regularly utilizes a model that projects net interest income based on increasing or decreasing interest rates, in order to be better able to respond to changes in interest rates.

At June 30, 2009, $262.9 million or 85.6% of the Company’s securities had fixed interest rates. Changes in interest rates affect the value of the Company’s interest earning assets and in particular its securities portfolio. Generally, the value of securities fluctuates inversely with changes in interest rates. Increases in interest rates could result in decreases in the market value of interest earning assets, which could adversely affect the Company’s results of operations if sold. The Company is also subject to reinvestment risk associated with changes in interest rates. Changes in interest rates may affect the average life of loans and mortgage related securities. In periods of decreasing interest rates, the average life of loans and securities held by the Company may be shortened to the extent increased prepayment activity occurs during such periods which, in turn, may result in the investment of funds from such prepayments in lower yielding assets. Under these circumstances the Company is subject to reinvestment risk to the extent that it is unable to reinvest the cash received from such prepayments at rates that are comparable to the rates on existing loans and securities. Additionally, increases in interest rates may result in decreasing loan prepayments with respect to fixed rate loans, (and therefore an increase in the average life of such loans), may result in a decrease in loan demand, and make it more difficult for borrowers to repay adjustable rate loans.

The Company utilizes the results of a detailed and dynamic simulation model to quantify the estimated exposure to net interest income to sustained interest rate changes. Management routinely monitors simulated net interest income sensitivity over a rolling two-year horizon. The simulation model captures the seasonality of the Company’s deposit flows and the impact of changing interest rates on the interest income received and the interest expense paid on all assets and liabilities reflected on the Company’s consolidated balance sheet. This sensitivity analysis is compared to the asset and liability policy limits that specify a maximum tolerance level for net interest income exposure over a one-year horizon given a 100 and 200 basis point upward shift in interest rates and a 100 basis point downward shift in interest rates. A parallel and pro rata shift in rates over a twelve-month period is assumed.

The following reflects the Company’s net interest income sensitivity analysis at June 30, 2009:

		June 30, 2009						December 31, 2008
		Potential Change						Potential Change
Change in Interest		in Net						in Net
Rates in Basis Points	Interest Income						Interest Income
(Dollars in thousands)	$ Change			% Change			$ Change			% Change
200	$	(1,078	)		(3.09	%)	$	(2,617	)		(7.27	%)
100	$	(503	)		(1.44	%)	$	(1,250	)		(3.47	%)
Static		—			—			—			—
(100)	$	74			0.21	%	$	249			0.69	%

The preceding sensitivity analysis does not represent a Company forecast and should not be relied upon as being indicative of expected operating results. These hypothetical estimates are based upon numerous assumptions including, but not limited to, the nature and timing of interest rate levels and yield curve shapes, prepayments on loans and securities, deposit decay rates, pricing decisions on loans and deposits, and reinvestment and replacement of asset and liability cash flows. While assumptions are developed based upon perceived current economic and local market conditions, the Company cannot make any assurances as to the predictive nature of these assumptions including how customer preferences or competitor influences may change.

Page 29

Also, as market conditions vary from those assumed in the sensitivity analysis, actual results will also differ due to prepayment and refinancing levels likely deviating from those assumed, the varying impact of interest rate change caps or floors on adjustable rate assets, the potential effect of changing debt service levels on customers with adjustable rate loans, depositor early withdrawals, prepayment penalties and product preference changes and other internal and external variables. Furthermore, the sensitivity analysis does not reflect actions that management might take in responding to, or anticipating changes in interest rates and market conditions.

Item 4. Controls and Procedures

An evaluation was performed under the supervision and with the participation of the Company’s management, including the Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Securities and Exchange Act of 1934, as amended) as of June 30, 2009. Based on that evaluation, the Company’s Principal Executive Officer and Principal Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this quarterly report. There has been no change in the Company’s internal control over financial reporting during the quarter that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

Page 30

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 1A. Risk Factors

There have been no material changes to the factors disclosed in Item 1A., Risk Factors, in our Annual Report on Form 10-K for the year ended December 31, 2008.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(a) Not applicable.

(b) Not applicable.

(c) Not applicable.

Item 3. Defaults upon Senior Securities

Not applicable.

Item 4. Submission of Matters to a Vote of Security Holders

The Annual Meeting of Shareholders was held at The Bridgehampton National Bank, 2200 Montauk Highway, Bridgehampton, New York 11932 on April 24, 2009.

Routine items included the election of three Directors.

Nominees for Director	Term	Votes For		Votes Withheld
Class A
Albert E. McCoy, Jr.	Three Years		5,264,702		101,263
Dennis Suskind	Three Years		5,146,026		219,939
R. Timothy Maran	Three Years		5,261,081		104,884

The other item voted upon was the ratification of the appointment of the Company’s Independent Registered Public Accounting Firm, Crowe Horwath LLP, for the year ending December 31, 2009.

	Votes For		Votes Against		Abstentions
Ratification of Independent Registered Public Accounting Firm		5,351,959		2,479		11,530

Item 5. Other Information

Not applicable.

Item 6. Exhibits and Reports on Form 8-K

3.2	Revised By-laws of the Registrant
10.2	Amended and Restated Employment Agreement — Howard H. Nolan
31.1	Certification of Principal Executive Officer pursuant to Rule 13a-14(a)
31.2	Certification of Principal Financial Officer pursuant to Rule 13a-14(a)
32.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(b) and 18 U.S.C. Section 1350

Page 31

SIGNATURES

In accordance with the requirement of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	BRIDGE BANCORP, INC. Registrant
August 6, 2009	/s/ Kevin M. O’Connor
	Kevin M. O’Connor
	President and Chief Executive Officer
August 6, 2009	/s/ Howard H. Nolan
	Howard H. Nolan
	Senior Executive Vice President, Chief Financial Officer

Page 32

Exhibit
No.		Description
	3.2	Revised By-laws of the Registrant
	10.2	Amended and restated employment agreement — Howard H. Nolan
	31.1	Certification of Principal Executive Officer pursuant to Rule 13a-14(a)
	31.2	Certification of Principal Financial Officer pursuant to Rule 13a-14(a)
	32.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(b) and 18 U.S.C. Section 1350

Page 33

EX-3.2

EXHIBIT 3.2

BYLAWS
of
BRIDGE BANCORP, INC.

These Bylaws are supplemental to the New York Business Corporation Law and other applicable provisions of law, as the same shall from time to time be in effect.

ARTICLE I — MEETINGS OF SHAREHOLDERS

Section 101 — Place of Meetings

All meetings of the shareholders shall be held at such place or places, within or without the State of New York, as shall be determined by the Board of Directors from time to time.

Section 102 — Annual Meetings

The annual meeting of the shareholders for the election of directors and the transaction of such other business as may properly come before the meeting shall be held at such date or hour as may be fixed by the Board of Directors. Any business which is a proper subject for shareholder action may be transacted at the annual meeting, irrespective of whether the notice of said meeting contains any reference thereto, except as otherwise provided by applicable law.

Section 103 — Special Meeting

Special meetings of the shareholders may be called at any time by the Board of Directors.

Section 104 — Conduct of Shareholders’ Meetings.

The President of the Corporation shall preside at all shareholders’ meetings. In the absence of the President, the Chairperson shall preside or, in his/her absence, any officer designated by the Board of Directors. The officer presiding over the shareholders’ meeting may establish such rules and regulations for the conduct of the meeting as he/she may deem to be reasonably necessary or desirable for the orderly and expeditious conduct of the meeting. Unless the officer presiding over the shareholders’ meeting otherwise requires, shareholders need not vote by ballot on any question.

Section 105 — Nomination by Shareholders and New Business Proposals.

(a) Nominations of persons for election to the Board of Directors and the proposal of business to be transacted by the shareholders may be made at an annual meeting of shareholders (i) pursuant to the Corporation’s notice with respect to such meeting, (ii) by or at the direction of the Board of Directors or (iii) by any stockholder of record of the Corporation who was a stockholder of record at the time of the giving of the notice provided for in the following paragraph, who is entitled to vote at the meeting and who has complied with the notice procedures set forth in this section.

(b) For nominations or other business to be properly brought before an annual meeting by a stockholder pursuant to clause (iii) of the foregoing paragraph, (1) the stockholder must have given timely notice thereof in writing to the Secretary of the Corporation (the “Notice”), (2) such business must be a proper matter for stockholder action under the New York Business Corporation Law, (3) the Notice must include the information required hereunder. To be timely, a stockholder’s notice shall be delivered to the Secretary at the principal executive offices of the Corporation not less than 90 days prior to the date of the Corporation’s proxy materials for the preceding year’s annual meeting of shareholders (“Proxy Statement Date”); provided, however, that if the date of the annual meeting is advanced more than 30 days prior to or delayed by more than 30 days after the anniversary of the preceding year’s annual meeting, notice by the stockholder to be timely must be so delivered not later than the close of business on the 10^th day following the day on which public announcement of the date of such meeting is first made. A stockholder’s Notice must include the following information

• A statement that the writer is a stockholder and is proposing a candidate for consideration by the Board or is proposing business for the consideration by the shareholders of the Corporation;

• The name and address of the stockholder as they appear on the Corporation’s books, and number of shares of the Corporation’s common stock that are owned beneficially by such stockholder (if the stockholder is not a holder of record, appropriate evidence of the stockholder’s ownership will be required);

• As to a nomination for election to the Board, the name, address and contact information for the candidate, and the number of shares of common stock of the Corporation that are owned by the candidate (if the candidate is not a holder of record, appropriate evidence of the stockholder’s ownership should be provided);

• As to a nomination to the Board, a statement of the candidate’s business and educational experience, detailed information about any relationship or understanding between the proposing stockholder and the candidate, and a statement that the candidate is willing to be considered and willing to serve as a director if nominated and elected;

• As to any business that the stockholder proposes to bring before the meeting, a brief description of such business;

• Such other information regarding the candidate or the business proposed as would be required to be included in the proxy statement pursuant to SEC Regulation 14A, including as to a proposal for business to be considered, any material interest that the stockholder has with respect to the business being proposed;

• A statement detailing any relationship between the proposing stockholder, any candidate for election to the Board, and any customer, supplier or competitor of Bridge Bancorp and its affiliates;

• A statement as to whether either such stockholder intends to deliver a proxy statement and form of proxy to holders of, in the case of a proposal, at least the percentage of the Corporation’s voting shares required under applicable law to carry the proposal or, in the case of a nomination or nominations, a sufficient number of holders of the Corporation’s voting shares to elect such nominee or nominees (an affirmative statement of such intent, a “Solicitation Notice”).

2

(c) Only persons nominated in accordance with the procedures set forth in this Section 10 shall be eligible to serve as directors and only such business shall be conducted at an annual meeting of shareholders as shall have been brought before the meeting in accordance with the procedures set forth in this section. The chairman of the meeting shall have the power and the duty to determine whether a nomination or any business proposed to be brought before the meeting has been made in accordance with the procedures set forth in these Bylaws and, if any proposed nomination or business is not in compliance with these Bylaws, to declare that such defectively proposed business or nomination shall not be presented for stockholder action at the meeting and shall be disregarded.

(d) For purposes of these Bylaws, “public announcement” shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or a comparable national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.

(e) Notwithstanding the foregoing provisions of this Section 105, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to matters set forth in this Section 105. Nothing in this Section 1 shall be deemed to affect any rights of shareholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act.

ARTICLE II — DIRECTORS AND BOARD MEETINGS

Section 201 — Management by Board of Directors

The business and affairs of the Corporation shall be managed under the direction of its Board of Directors. The Board of Directors may exercise all such powers of the Corporation and do all such lawful acts and things as are not by statute, regulation, the Certificate of Incorporation or these Bylaws directed or required to be exercised or done by the shareholders.

Section 202 — Directors Must be Shareholders

Every director must be a shareholder of the Corporation and shall own in his/her own right the number of shares (if any) required by law in order to qualify as such director. Any director shall forthwith cease to be a director when he/she no longer holds such shares, which fact shall be reported to the Board of Directors by the Secretary, whereupon the Board of Directors shall declare the seat of such directors vacated.

3

Section 203 — Eligibility and Mandatory Retirement

No person shall be eligible to be newly elected or appointed as a director if he/she shall have attained the age of 73 years on or prior to the date of his/her election or appointment. Any director of this Corporation who attains the age of 73 years shall cease to be a director (without any action on his/her part) at the close of business on the day prior to the date of the next shareholders’ meeting at which directors are to be elected regardless of whether or not his/her term as a director would otherwise expire at such shareholders’ meeting.

Section 204 — Number of Directors

The Board of Directors shall consist of not less than five (5) nor more than twenty-five (25) persons, the exact number to be fixed and determined from time to time by resolution of a majority of the full Board of Directors.

Section 205 — Classification of Directors

The directors shall be divided into three (3) classes, as nearly equal in number as possible, known as Class A, consisting of not more than eight (8) directors; Class B, consisting of not more than eight (8) directors; and Class C, consisting of not more than nine (9) directors. Such classes shall become effective with the annual meeting of shareholders in 2002. The initial directors of Class A shall be the present directors of Class 1 who are continuing in office and who were elected at the annual meeting in 2001 to hold office until the annual meeting in 2003 and shall serve out their current terms until the annual meeting in 2003. At the annual meeting of the shareholders in 2003, the directors of Class A shall be elected for a term of three (3) years and, after expiration of such term, shall thereafter be elected every three (3) years for three (3) year terms. The initial directors of Class B shall be elected at the annual meeting in 2002 and shall serve until the annual meeting of shareholders in 2004. At the annual meeting of the shareholders in 2004, the directors of Class B shall be elected for a term of three (3) years and, after the expiration of such term, shall thereafter be elected every three (3) years for three (3) year terms. The initial directors of Class C shall be elected at the annual meeting in 2002 and shall serve until the annual meeting of shareholders in 2005. At the annual meeting of shareholders in 2005, the directors of Class C shall be elected for a term of three (3) years and, after the expiration of such term, shall thereafter be elected every three (3) years for three (3) year terms. Each director shall serve until his/her successor shall have been elected and shall qualify, even though his/her term of office as herein provided has otherwise expired, except in the event of his/her earlier resignation, removal or disqualification.

Section 206 — Vacancies

Vacancies in the Board of Directors, including vacancies resulting from an increase in the number of directors, shall be filled by a majority of the remaining members of the Board, even though less than a quorum. If the number of directors is changed: (i) any newly created directorships or any decrease in directorships shall be so apportioned among the classes as to make all classes as nearly equal in number as possible; and (ii) when the number of directors is increased by the board and any newly created directorships are filled by the board, there shall be no classification of the additional directors until the next annual meeting of shareholders.

4

Section 207 — Compensation of Directors

Directors, as such, may receive, pursuant to resolution of the Board of Directors, fixed fees, including any combination of a retainer payment(s) and meeting fees, and other compensation for their services as Directors, including, without limitation, their services as members of committees of the Board of Directors. Directors may also receive stock benefits under any stock benefit plan approved by the shareholders of the Corporation. The Corporation may reimburse directors for expenses related to their duties as a member of the Board.

Section 208 — Organization Meeting

The President or Secretary, upon receiving the certificate of the judges, of the result of any election, shall notify the directors-elect of their election and of the time at which they are required to meet for the purpose of organizing the new Board and electing and appointing officers of the Corporation for the succeeding year. Such meeting shall be held on the day of the election or as soon thereafter as practicable, and, in any event, within thirty days thereof. If, at the time fixed for such meeting, there shall not be a quorum present, the directors present may adjourn the meeting, from time to time, until a quorum is obtained.

Section 209 — Regular Meetings

Regular meetings of the Board of Directors shall be held on such day, at such hour, and at such place, consistent with applicable law, as the Board shall from time to time designate or as may be designated in any notice from the Secretary calling the meeting. Notice need not be given of regular meetings of the Board of Directors which are held at the time and place designated by the Board of Directors.

If a regular meeting is not to be held at the time and place designated by the Board of Directors, notice of such meeting, which need not specify the business to be transacted thereat and which may be either verbal or in writing, shall be given by the Secretary to each member of the Board at least twenty-four (24) hours before the time of the meeting.

A majority of the members of the Board of Directors shall constitute a quorum for the transaction of business. If at the time fixed for the meeting, including the meeting to organize the new Board following the annual meeting of shareholders, a quorum is not present, the directors in attendance may adjourn the meeting from time to time until a quorum is obtained.

Except as otherwise provided herein, a majority of those directors present and voting at any meeting of the Board of Directors, shall decide each matter considered. A director cannot vote by proxy, or otherwise act by proxy at a meeting of the Board of Directors.

5

Section 210 — Special Meetings

Special meetings of the Board of Directors may be called by the President, the Executive Vice President, or at the request of three or more members of the Board of Directors. A special meeting of the Board of Directors shall be deemed to be any meeting other than the regular meeting of the Board of Directors. Notice of the time and place of every special meeting, which need not specify the business to be transacted thereat and which may be either verbal or in writing, shall be given by the Secretary to each member of the Board at least twenty-four (24) hours before the time of such meeting excepting the Organization Meeting following the election of directors.

Section 211 — Reports and Records

The reports of officers and Committees and the records of the proceedings of all Committees shall be filed with the Secretary of the Corporation and presented to the Board of Directors, if practicable, at its next regular meeting. The Board of Directors shall keep complete records of its proceedings in a minute book kept for that purpose. When a director shall request it, the vote of each director upon a particular question shall be recorded in the minutes.

ARTICLE III — COMMITTEES

Section 301 — Committees

The Board of Directors, by a vote of a majority of the Board, may from time to time designate such committees, including without limitation an executive committee, of the Board of Directors as it deems necessary or appropriate for the conduct of the affairs of the Corporation. The Board of Directors may confer on such committees such powers and duties as it deems appropriate, unless proscribed by law. The committees shall serve at the pleasure of the Board.

Section 302 — Appointment of Committee Members

The Board of Directors shall elect the members of the Committees and the Chairperson and Vice Chairperson of each such Committee to serve until the next annual meeting of shareholders.

Section 303 — Organization and Proceedings

Each Committee of the Board of Directors may effect its own organization by the appointment of a Secretary and such other officers, except the Chairperson and Vice Chairperson, as it may deem necessary. A record of proceedings of all Committees shall be kept by the Secretary of such Committee and filed and presented as provided in Section 211 of these Bylaws.

ARTICLE IV — OFFICERS

Section 401 — Officers

The officers of the Corporation shall be a Chairperson of the Board, a Vice Chairperson, a President, one (1) or more Vice Presidents (one (1) or more of whom may be designated an Executive Vice President), a Secretary, a Treasurer, and such other officers and assistant offices as the Board of Directors may from time to time deem advisable. Except for the President, Secretary and Treasurer, the Board may refrain from filling any of the said offices at any time and from time to time. The same individual may hold any two (2) or more offices except both the offices of President and Secretary. The officers shall be elected by the Board of Directors at the annual organization meeting, in the manner and for such terms as the Board of Directors from time to time shall determine. Any officer may be removed at any time, with or without cause, and regardless of the term for which such officer was elected, but without prejudice to any contract right of such officer. Each officer shall hold his office for the current year for which he was elected or appointed by the Board unless he shall resign, becomes disqualified, or be removed at the pleasure of the Board of Directors.

6

Section 402 — Chairperson of the Board

The Board of Directors shall elect a Chairperson of the Board at the organization meeting of the Board following each annual meeting of shareholders at which directors are elected. The Chairperson of the Board shall be a member of the Board of Directors and shall preside at the meetings of the Board and perform such other duties as may be prescribed by the Board of Directors.

Section 403 — Vice Chairperson of the Board

The Board may appoint one of its members to be Vice Chairperson of the Board. Such person shall assist the Chairperson of the Board and shall also have and may exercise such further powers and duties as from time to time may be conferred, or assigned by the Board.

Section 404 — President

The President shall have general supervision of all of the departments and business of the Corporation and shall prescribe the duties of the other officers and employees and see to the proper performance thereof. The President shall be responsible for having all orders and resolutions of the Board of Directors carried into effect. The President shall execute on behalf of the Corporation and may affix or cause to be affixed a seal to all authorized documents and instruments requiring such execution, except to the extent that signing and execution thereof shall have been delegated to some other officer or agent of the Corporation by the Board of Directors or by the President. The President shall be Chief Executive Officer and a member of the Board of Directors. In the absence or disability of the Chairperson of the Board or Vice Chairperson of the Board or his/her refusal to act, the President shall preside at meetings of the Board. In general, the President shall perform all the duties and exercise all the powers and authorities incident to such office or as prescribed by the Board of Directors.

Section 405 — Vice Presidents

The Vice President shall perform such duties, do such acts and be subject to such supervision as may be prescribed by the Board of Directors or the President. One or more vice presidents may be designated as executive or senior vice presidents. In the event of the absence or disability of the President or his/her refusal to act, the Vice Presidents, in the order of their rank, and within the same rank in the order of their authority, shall perform the duties and have the powers and authorities of the President, except to the extent inconsistent with applicable law.

7

Section 406 — Secretary

The Secretary shall act under the supervision of the President or such other officers as the President may designate. Unless a designation to the contrary is made at a meeting, the Secretary shall attend all meetings of the Board of Directors and all meetings of the shareholders and record all the proceedings of such meetings in a book to be kept for that purpose, and shall perform like duties for the standing Committees when required by these Bylaws or otherwise. The Secretary shall give, or cause to be given, notice of all meetings of the shareholders and of the Board of Directors. The Secretary shall keep a seal of the Corporation, and when authorized by the Board of Directors or the President, cause it to be affixed to any documents and instruments requiring it. The Secretary shall perform such other duties as may be prescribed by the Board of Directors, President, or other supervising officer as the President may designate.

Section 407 — Treasurer

The Treasurer shall act under the supervision of the President or such other assistant officer as the President may designate. The Treasurer shall have custody of the Corporation’s funds and such other duties as may be prescribed by the Board of Directors, President or such other supervising officer as the President may designate.

Section 408 — Assistant Officers

Unless otherwise provided by the Board of Directors, each assistant officer shall perform such duties as shall be prescribed by the Board of Directors, the President or the officer to whom he/she is an assistant. In the event of the absence or disability of an officer or his/her refusal to act, his/her assistant officer shall, in the order of their rank, and within the same rank in the order of their seniority, have the powers and authorities of such officer.

Section 409 — Compensation

The salaries and compensation of all officers and assistant officers shall be fixed by or in the manner designated by the Board of Directors.

Section 410 — General Powers

The officers are authorized to do and perform such corporate acts as are necessary in the carrying on of the business of the Corporation, subject always to the direction of the Board of Directors.

ARTICLE V — INDEMNIFICATION OF DIRECTORS AND OFFICERS

Section 501 — Right to Indemnification

Any person who was, is, or is threatened to be made a party to any action or proceeding, whether civil or criminal (including an action by or in the right of the Corporation or any other corporation, partnership, join venture, trust, employee benefit plan or other enterprise which any director or officer of the Corporation served in any capacity at the request of this Corporation), by reason of the fact that he, his testator or intestate, is or was a director or officer of the Corporation, or served such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise in any capacity, shall be indemnified by the Corporation against all judgements, fines, amounts paid in settlement and reasonable expenses, including attorneys’ fees actually and necessarily incurred in connection with the defense or appeal of any such action or proceeding, and against any other amounts, expenses and fees similarly incurred; provided that no indemnification shall be made to or on behalf of any director or officer where indemnification is prohibited by applicable law. This right of indemnification shall include the right of a director or officer to receive payment from the Corporation for expenses incurred in defending or appealing any such action or proceeding in advance of its final disposition; provided that the payment of expenses in advance of the final disposition of an action or proceeding shall be made only upon delivery to the Corporation of an undertaking by or on behalf of the director or officer to repay all amounts so advanced if it should be determined ultimately that the director or officer is not entitled to be indemnified. The preceding right of indemnification shall be a contract right enforceable by the director or officer with respect to any claim, cause of action, action or proceeding accruing or arising while this Bylaw shall be in effect.

8

Section 502 — Authorization of Indemnification

Any indemnification provided for by Section 501 shall be authorized in any manner provided by applicable law or, in the absence of such law;

(a) By the Board of Directors acting by a quorum of directors who are not parties to such action or proceeding, upon a finding that there has been no judgement or other final adjudication adverse to the director or officer which establishes that his acts were committed in bad faith or were the result of active and deliberate dishonesty and were material to the cause of action so adjudicated, or that he personally gained in fact a financial profit or other advantage to which he was not legally entitled; or

(b) If a quorum under clause (a) is not obtainable, (i) by the Board upon the opinion in writing of independent legal counsel that indemnification is proper in the circumstances because there has been no such judgement or other final adjudication adverse to the director or officer, or (ii) by the shareholders upon a finding that there has been no such judgement or other final adjudication adverse to the director or officer.

Section 503 — Right of Claimant to Bring Suit

If a claim of indemnification is not paid in full by the Corporation within ninety days after a written claim has been received by the Corporation, the claimant may at any time there- after bring suit against the Corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall also be entitled to recover the expenses of prosecuting such claim.

Section 504 — Non-Exclusivity of Rights

The rights conferred on any person under this Article shall not be exclusive of any other right which may exist under any statute, provision of the Certificate of Incorporation, Bylaw, agreement, vote of shareholders or disinterested directors or otherwise.

Section 505 — Insurance

Subject to the laws of New York, the Corporation may maintain insurance, as its expense, to protect itself and any director, officer, employee or agent of the Corporation against any expense, liability or loss of the general nature contemplated by this Article, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the laws of New York.

9

Section 506 — Severability

It is the intent of the Corporation to indemnify its officers and directors to the fullest extent authorized by the laws of New York as they now exist or may hereafter be amended. If any portion of this Article shall for any reason be held invalid or unenforceable by judicial decision or legislative amendment, the valid and enforceable provisions of this Article will continue to be given effect and shall be construed so as to provide the broadest indemnification permitted by law.

ARTICLE VI — SHARES OF CAPITAL STOCK

Section 601 — Authority to Sign Share Certificates

Every share certificate of the Corporation shall be signed by the President and by either the Secretary (or one of the Assistant Secretaries) or the Treasurer (or one of the Assistant Treasurers). Certificates may be signed by a facsimile signature of the aforesaid Officers of the Corporation authorized to sign share certificates. The Board of Directors may provide by resolution or resolutions that some or all of any or all classes or series of its stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the Corporation.

Section 602 — Lost or Destroyed Certificates

Any person claiming a share certificate to be lost, destroyed or wrongfully taken shall receive a replacement certificate if such person shall have:

(a) Requested such replacement certificate before the Corporation has notice that the shares have been acquired by a bona fide purchaser;

(b) Provided the Corporation with an indemnity agreement satisfactory in form and substance to the Board of Directors, or the President or the Secretary; and

(c) Satisfied any other reasonable requirements (including providing an affidavit and a surety bond) fixed by the Board of Directors, or the President or the Secretary.

10

ARTICLE VII — GENERAL

Section 701 — Fiscal Year

The fiscal year of the Corporation shall begin on the first (1st) day of January in each year and end on the thirty-first (31st) day of December in each year.

Section 702 — Record Date

The Board of Directors may fix any time whatsoever (but not more than sixty (60) days) prior to the date of any meeting of shareholders, or the date for the payment of any dividend or distribution, or the date for the allotment of rights, or the date when any change or conversion or exchange of shares will be made of will go into effect, as a record date for the determination of the shareholders entitled to notice of, or to vote at, any such meetings, or entitled to receive payment of any such dividend or distribution, or to receive any such allotment of rights, or to exercise the rights in respect to any such change, conversion or exchange of shares.

Section 703 — Participation in Meetings By Conference Telephone

Members of the Board of Directors, or of any committee thereof, may participate in a meeting of such Board or committee by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other and such participation shall constitute presence in person at such meeting.

Section 704 — Emergency Bylaws

In the event of any emergency resulting from a nuclear attack or similar disaster, and during the continuance of such emergency, the following Bylaw provisions shall be in effect, notwithstanding any other provisions of the Bylaws:

(a) A meeting of the Board of Directors or of any Committee thereof may be called by any officer or director upon one (1) hour’s notice to all persons entitled to notice whom, in the sole judgement of the notifier, it is feasible to notify;

(b) The director or directors in attendance at the meeting of the Board of Directors or of any Committee thereof shall constitute a quorum; and

(c) These Bylaws may be amended or repealed, in whole or in part, by a majority vote of the directors attending any meeting of the Board of Directors, provided such amendment or repeal shall only be effective for the duration of such emergency.

Section 705 — Severability

If a provision of these Bylaws is illegal or unenforceable as such, illegality or un-enforceability shall not affect any other provision of these Bylaws and such other provisions shall continue in full force and effect.

11

ARTICLE VIII — AMENDMENT OR REPEAL

Section 801 — Amendment or Repeal by the Board of Directors

These Bylaws may be amended or repealed, in whole or in part, by a majority vote of the full Board of Directors at any regular or special meeting of the Board duly convened. Notice need not be given of the purpose of the meeting of the Board of Directors at which the amendment or repeal is to be considered.

Section 802 — Recording Amendments and Repeals

The text of all amendments and repeals to these Bylaws shall be attached to the Bylaws with a notation of the date and vote of such amendment or repeal.

ARTICLE IX APPROVAL OF AMENDED BYLAWS AND
RECORD OF AMENDMENTS AND REPEALS

Section 901 — Approval and Effective Date These Bylaws have been approved as the Bylaws of the Corporation this 23rd day of June, 2009 and shall be effective as of said date.

Howard H. Nolan, Corporate Secretary

12

Section 902 — Amendments or Repeals

	Date Amended
Section Involved	or Repealed	Approved By
203	June 23, 2009	Board of Directors

Section 203 has been amended to read in its entirety as follows:

Section 203 — Eligibility and Mandatory Retirement

No person shall be eligible to be newly elected or appointed as a director if he/she shall have attained the age of 73 years on or prior to the date of his/her election or appointment. Any director of this Corporation who attains the age of 73 years shall cease to be a director (without any action on his/her part) at the close of business on the day prior to the date of the next shareholders’ meeting at which directors are to be elected regardless of whether or not his/her term as a director would otherwise expire at such shareholders’ meeting.

13

EX-10.2

EXHIBIT 10.2

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as of June 25, 2009 (the “Effective Date”) by and between Bridge Bancorp, Inc. (the “Company”), a New York corporation, Bridgehampton National Bank (the “Bank”), a bank organized and existing under the laws of the United States of America and a wholly owned subsidiary of the Company, and Howard H. Nolan (the “Executive”).

WHEREAS, the Executive is currently employed as the Senior Executive Vice President and Chief Administrative and Financial Officer of the Company and Bank pursuant to an employment agreement between the Company, Bank and Executive originally entered into as of June 26, 2006, and subsequently amended as of January 1, 2008 (the “Original Agreement”);

WHEREAS, the Company and Bank desire to amend and restate the Original Agreement in order to make certain changes;

WHEREAS, the Company and Bank desire to ensure the continued availability of the Executive’s services as provided in this Agreement;

WHEREAS, the Executive is willing to serve the Company and Bank on the terms and conditions hereinafter set forth; and

NOW THEREFORE, in consideration of these premises, the mutual covenants contained herein, and other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Employment Period.

(a) Three Year Term. The Executive’s period of employment with the Bank and the Company under the terms of this Agreement shall begin on the Effective Date and shall continue for a period of thirty-six (36) months thereafter (the “Employment Period”).

(b) Annual Performance Evaluation. On a calendar year basis, the Bank and/or the Company (acting through the full Board or a committee thereof) shall conduct an annual performance evaluation of the Executive, the results of which shall be included in the minutes of the Board or committee meeting and communicated to the Executive. The first such annual performance evaluation shall occur in January 2010.

(c) Continued Employment Following Termination of Employment Period. Nothing in this Agreement shall mandate or prohibit a continuation of the Executive’s employment following the expiration of the Employment Period.

2. Duties.

(a) Title; Board Position, Responsibility. The Executive shall serve as the Senior Executive Vice President and Chief Administrative and Financial Officer of the Bank and Company, and shall perform such administrative and management services as customarily performed by person in a similar executive capacity and as may be directed from time to time by the Chief Executive Officer of the Company and Bank and/or the Board of Directors of the Company and/or Bank (the “Board”). In his capacity as Senior Executive Vice President and Chief Administrative and Financial Officer, the Executive shall report directly to the President and Chief Executive Officer and to the Board. The Executive shall also continue to be a member of the Board. If Executive’s employment with the Bank or the Company is terminated for any reason, his service on the Board shall terminate, and this Agreement shall serve as Executive’s written resignation for that purpose.

(b) Time Commitment. The Executive shall devote his full business time and attention to the business and affairs of the Bank and the Company and shall use his best efforts to advance the interests of the Bank and Company.

3. Annual Compensation.

(a) Annual Salary. In consideration for the services performed by the Executive under this Agreement, the Bank shall pay to the Executive an annual salary (“Base Salary”) of not less than $230,000. The Base Salary shall be paid in approximately equal installments in accordance with the Bank’s customary payroll practices. The Bank shall review the Executive’s Base Salary at least annually and such Base Salary may be increased, but may not be decreased without the Executive’s consent (any increase in Base Salary shall become the new “Base Salary” for purposes of this Agreement). The first such annual review of Executive’s performance and Base Salary shall occur in January 2010.

(b) Board Meeting Fees. For his attendance at meetings of the Board of Directors of the Bank and the Company (but not for committee meetings), the Executive shall receive such fees as are paid to directors of the Bank and the Company for such attendance.

(c) Incentive Compensation. The Executive shall be eligible to participate in any incentive compensation programs established by the Bank and/or the Company from time to time for senior executive officers, in accordance with the terms of such plans as they may exist from time to time.

(d) Equity Compensation. The Executive shall be eligible to participate in any equity compensation programs established by the Bank and/or the Company from time to time for senior executive officers, including, but not limited to, the 2006 Stock-Based Incentive Plan (the “2006 Plan”).

Nothing paid to Executive under any plan, program or arrangement referenced in (c) or (d) above shall be deemed to be in lieu of other compensation to which Executive is entitled under this Agreement.

2

4. Employee Benefit Plans; Paid Time Off

(a) Benefit Plans. During the Employment Period, the Executive shall be an employee of the Bank and shall continue to participate in the Bank’s (i) tax-qualified retirement plans (i.e., the defined benefit plan and 401(k) plan); (ii) the Bank’s Supplemental Executive Retirement Plan; (iii) group life, health and disability insurance plans; and (iv) any other employee benefit plans and programs in accordance with the Bank’s customary practices, provided he is a member of the class of employees authorized to participate in such plans or programs.

(b) Paid Time Off. The Executive shall be entitled to paid vacation time each year during the Employment Period, as well as sick leave, holidays and other paid absences, in accordance with the Bank’s policies and procedures for executive employees.

5. Outside Activities and Board Memberships

During the term of this Agreement, the Executive shall not, directly or indirectly, provide services on behalf of any financial institution, any insurance company or agency, any mortgage or loan broker or any other entity or on behalf of any subsidiary or affiliate of any such entity engaged in the financial services industry, as an employee, consultant, independent contractor, agent, sole proprietor, partner, joint venturer, corporate officer or director; nor shall the Executive acquire by reason of purchase during the term of this Agreement the ownership of more than 5% of the outstanding equity interest in any such entity. Subject to the foregoing, and to the Executive’s right to continue to serve as an officer and/or director or trustee of any business organization as to which he was so serving on the Effective Date of this Agreement (as described in an attachment to this Agreement or to the Original Agreement), the Executive may serve on boards of directors of unaffiliated, for-profit business corporations, subject to Board approval, which shall not be unreasonably withheld, and such services shall be presumed for these purposes to be for the benefit of the Bank and the Company. Except as specifically set forth herein, the Executive may engage in personal business and investment activities, including real estate investments and personal investments in the stocks, securities and obligations of other financial institutions (or their holding companies). Notwithstanding the foregoing, in no event shall the Executive’s outside activities, services, personal business and investments materially interfere with the performance of his duties under this Agreement.

6. Working Facilities and Expenses

(a) Working Facilities. The Executive’s principal place of employment shall be at the Bank’s principal executive office or at such other location upon which the Bank and the Executive may mutually agree.

3

(b) Expenses.

(i) Ordinary Expenses. The Bank shall reimburse the Executive for his ordinary and necessary business expenses, incurred in connection with the performance of his duties under this Agreement, upon presentation to the Bank of an itemized account of such expenses in such form as the Bank may reasonably require. Any such expense shall be reimbursed no later than two and one-half months following the end of the year in which the expense was incurred.

(ii) Automobile. The Bank shall provide the Executive with an automobile suitable to the Executive’s position and such automobile may be used by the Executive in carrying out his duties under this Agreement, including commuting between his residence and his principal place of employment and other personal use. The Bank shall be responsible for the cost of maintenance and servicing such automobile and for insurance, gasoline and oil for such automobile. The Executive shall be responsible for the payment of any taxes on account of his personal use of such automobile.

7. Termination of Employment with Bank Liability

(a) Reasons for Termination. In the event that the Executive’s employment with the Bank and/or the Company shall terminate during the Employment Period on account of any of the events set forth in Sections 7(a)(i) or 7(a)(ii) below (an “Event of Termination”), the Bank shall provide the benefits and pay to the Executive the amounts provided for under Section 7(b) or Section 7(c), as applicable:

(i) The Executive’s voluntary resignation from employment with the Bank and the Company during the term of this Agreement within 30 days after the occurrence of any of the following events without Executive’s consent, such that the Executive’s resignation shall be treated as a resignation for “Good Reason,” provided that for purposes of this Section 7(a)(i), the Executive must provide not greater than ninety (90) days’ written notice to the Bank and the Company of the initial existence of such condition and the Bank and the Company shall have thirty (30) days to cure the condition giving rise to the Event of Termination (but the Bank and the Company may elect to waive such thirty (30) day period):

(A) the failure to re-appoint the Executive to the officer position set forth under Section 2(a) and/or, the failure of Executive to be appointed to the Board of Directors of the Bank, and with respect to the Executive’s service as a director of the Company, the failure to re-nominate the Executive for election to the Board;

(B) a material change in Executive’s functions, duties, or responsibilities, which change would cause Executive’s position to become one of lesser responsibility, importance, or scope;

(C) a liquidation or dissolution of the Bank or the Company other than a liquidation or dissolution that is caused by a reorganization that does not affect the status of the Executive;

(D) a material breach of this Agreement by the Bank and/or the Company; or

(E) the relocation of Executive’s principal place of employment to an office other than one located in Southampton, East Hampton, Shelter Island, Southold, Riverhead or Brookhaven, New York.

4

(ii) the involuntary termination of the Executive’s employment by the Bank and/or the Company for any reason other than: for “Cause” as defined in Section 8(a); for “Disability” as set forth in Section 7(d) below; in connection with a Change in Control, as set forth in Section 7(c) below; or as a result of the death of the Executive; provided that such involuntary termination of employment constitutes a “Separation from Service” within the meaning of Section 409A and the Treasury regulations thereunder.

(b) Severance Pay. Subject to the limitations set forth in Section 7(e) below, upon an Event of Termination, the Bank shall pay to the Executive (or, in the event of the Executive’s death after the event described in Section 7(a) has occurred, the Bank shall pay to the Executive’s surviving spouse, beneficiary or estate) an amount equal to the following:

(i) his earned but unpaid Base Salary as of the date of his termination of employment with the Bank;

(ii) the benefits to which he is entitled as a former employee under the Bank’s employee benefit plans;

(iii) a lump sum cash payment, as liquidated damages, in an amount equal to two (2) times the Executive’s Base Salary payable within ten (10) business days following the Event of Termination; and

(iv) continued group health and medical insurance benefits (on the same terms as such benefits are made available to other executive employees of the Bank) until the earlier to occur of (x) twenty-four (24) months following the Event of Termination, or (y) Executive’s full time employment with another employer.

(c) Change in Control. If within the period ending one year after a Change in Control (as defined in Section 9 of this Agreement), (i) the Bank and/or the Company terminates the Executive’s employment without Cause, or (ii) the Executive voluntarily terminates his employment with Good Reason, the Bank will:

(i) pay a lump sum cash payment to Executive, as liquidated damages, within ten (10) business days of the termination of the Executive’s employment, in an amount equal to three (3) times the Executive’s annual compensation for the calendar year immediately preceding the year in which the Change in Control occurs, and

(ii) provide continued group health and medical insurance benefits to Executive, (on the same terms as such benefits are made available to other executive employees of the Bank immediately prior to the Change in Control), until the earlier to occur of (x) 36 months following Executive’s termination of employment, or (y) Executive’s full time employment with another employer.

5

For purposes of Section 7(c)(i), annual compensation shall include all compensation reported in the Executive’s annual (IRS) Form W-2 (Box 5) for the calendar year.

(d) Disability.

(i) In the event that during the term of this Agreement, Executive is unable to perform his duties hereunder because he is disabled within the meaning of Code Section 409A and the Treasury regulations thereunder (a “Disability”), the Executive shall be entitled to any and all benefits under the Bank’s short-term and/or long-term disability insurance plan. During the first twenty-four (24) months following termination of employment for Disability, the Bank and/or the Company shall provide a supplemental monthly cash payment to Executive such that the payments received by Executive on a monthly basis, from both disability insurance and this supplemental payment shall equal the monthly rate of after-tax Base Salary being paid to Executive immediately prior to such termination (the insurance payments may be taken into account on a tax-adjusted basis if such payment are not subject to federal and/or state taxes).

(ii) Upon termination of Executive’s employment because of Disability, the Executive shall be entitled to continued group health and medical insurance benefits for a period of twenty-four (24) months following such termination, on the same terms as such benefits are made available to other executive employees immediately prior to the Disability.

(e) Timing of Severance Pay. Any cash severance payments shall be made in a lump sum within ten (10) business days of Executive’s termination of employment subject to applicable withholding taxes. Such payments shall not be reduced in the event the Executive obtains other employment following termination of employment with the Bank or following the Change in Control. Notwithstanding anything herein to the contrary, if Executive is a Specified Employee, as defined in Code Section 409A, and if any payment to be made under Section 7 shall be determined to be subject to Code Section 409A, then if required by Code Section 409A, such payment or a portion of such payment (to the minimum extent possible) shall be delayed and shall be paid on the first day of the seventh month following Executive’s Separation from Service pursuant to Treasury regulation Section 1.409A-1(b)(9)(iii).

(f) Executive agrees that upon any termination of his employment, whether by Executive or by the Bank or the Company, his service as a director of the Bank and the Company shall cease and he shall be deemed to have resigned as a director effective upon such termination.

6

8. Termination without Additional Bank or Company Liability

(a) Termination for Cause.

(i) The Bank and/or the Company may terminate the Executive’s employment at any time, but any termination other than termination for “Cause,” as defined herein, shall not prejudice the Executive’s right to compensation or other benefits under the Agreement. The Executive shall have no right to receive compensation or other benefits for any period after termination for “Cause.” Termination for “Cause” shall mean termination because of: (i) the conviction of the Executive of a felony or of any lesser criminal offense involving moral turpitude (other than for traffic violations); (ii) the willful commission by the Executive of a criminal or other act that, in the judgment of the Board or the President and Chief Executive Officer will likely cause substantial economic damage to the Company, the Bank or any subsidiary or substantial injury to the business reputation of the Company, the Bank or any subsidiary; (iii) the commission by the Executive of an act of fraud in the performance of his duties on behalf of the Company, the Bank or any subsidiary; (iv) the continuing willful failure of the Executive to perform his duties to the Company, the Bank or any subsidiary (other than any such failure resulting from the Executive’s incapacity due to physical or mental illness) after written notice thereof; (v) a material breach by the Executive of the Bank’s Code of Ethics; or (vi) an order of a federal or state regulatory agency or a court of competent jurisdiction requiring the termination of the Executive’s employment with the Bank or the Company.

(ii) Executive shall not have the right to receive compensation or other benefits for any period after the date of Termination for Cause. Notwithstanding the foregoing, Termination for Cause shall not be deemed to exist unless there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than a majority of the entire membership of the Board at a meeting of the Board called and held for the purpose (after reasonable notice to the Executive and an opportunity for the Executive to be heard before the Board), finding that in the good faith opinion of the Board the Executive was guilty of conduct described above and specifying the particulars thereof. Prior to holding a meeting at which the Board is to make a final determination whether Termination for Cause exists, if the Board determines in good faith at a meeting of the Board, by not less than a majority of its entire membership, that there is probable cause for it to find that the Executive was guilty of conduct constituting Termination for Cause as described above, the Board may suspend the Executive from his/her duties hereunder for a reasonable period of time not to exceed fourteen (14) days pending a further meeting at which the Executive shall be given the opportunity to be heard before the Board. For purposes of this subparagraph, no act or failure to act, on the Executive’s part shall be considered “willful” unless done, or omitted to be done, by his/her not in good faith without reasonable believe that his/her action or omission was in the best interest of the Company and the Bank.

7

(b) Death; Voluntary Resignation Without Good Reason. In the event that the Executive’s employment with the Bank shall terminate during the Employment Period on account of the reasons set forth in this Section 8(b), then the Bank shall have no further obligations under this Agreement, other than the payment to the Executive of his earned but unpaid salary as of the date of the termination of his employment, and the provision of such benefits, if any, to which he is entitled as a former employee under the Bank’s employee benefit plans and programs and compensation plans and programs, including without limitation, any incentive compensation plan. Termination of employment under this Section 8(b) shall mean termination of employment due to the following events:

(i)	The Executive’s death; or
(ii)	The Executive’s voluntary resignation from employment with the Bank for any reason other than the “Good Reason” as defined in Section 7(a)(i).

9. Change in Control

For purposes of this Agreement, the term “Change in Control” shall mean (i) a change in the ownership of the Bank or the Company, (ii) a change in the effective control of the Bank or Company, or (iii) a change in the ownership of a substantial portion of the assets of the Bank or Company, as described below.

(A) A change in ownership occurs on the date that any one person, or more than one person acting as a group (as defined in Treasury regulation section 1.409A-3(i)(5)(v)(B)), acquires ownership of stock of the Bank or Company that, together with stock held by such person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of such corporation.

(B) A change in the effective control of the Bank or Company occurs on the date that either (i) any one person, or more than one person acting as a group (as defined in Treasury regulation section 1.409A-3(i)(5)(v)(B)) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the Bank or Company possessing 30% or more of the total voting power of the stock of the Bank or Company, or (ii) a majority of the members of the Bank’s or Company’s board of directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Bank’s or Company’s board of directors prior to the date of the appointment or election, provided that this sub-section “(ii)” is inapplicable where a majority shareholder of the Bank or Company is another corporation.

(C) A change in a substantial portion of the Bank’s or Company’s assets occurs on the date that any one person or more than one person acting as a group (as defined in Treasury regulation section 1.409A-3(i)(5)(vii)(C)) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Bank or Company that have a total gross fair market value equal to or more than 40% of the total gross fair market value of (i) all of the assets of the Bank or Company, or (ii) the value of the assets being disposed of, either of which is determined without regard to any liabilities associated with such assets. For all purposes hereunder, the definition of Change in Control shall be construed to be consistent with the requirements of Treasury regulation section 1.409A-3(g)(5).

8

10. Confidentiality. Unless the Executive obtains prior written consent from the Bank or the Company, the Executive shall keep confidential and shall refrain from using for the benefit of himself, or any person or entity other than the Bank, the Company or any entity which is a subsidiary or affiliate of the Bank or the Company or of which the Bank or the Company is a subsidiary or affiliate, any material document or information obtained from the Bank, the Company or from any of their respective parents, subsidiaries or affiliates, in the course of his employment with any of them concerning their properties, operations or business (unless such document or information is readily ascertainable from public or published information or trade sources or has otherwise been made available to the public through no fault of his own) until the same ceases to be material (or becomes so ascertainable or available); provided, however, that nothing in this Section 10 shall prevent the Executive, with or without the Bank’s or the Company’s consent, from participating in or disclosing documents or information in connection with any judicial or administrative investigation, inquiry or proceeding to the extent that such participation or disclosure is required under applicable law.

11. Non-Solicitation; Non-Competition; Post-Termination Cooperation.

(a) The Executive hereby covenants and agrees that, for a period of one year following his termination of employment with the Bank, he shall not, without the written consent of the Bank, either directly or indirectly:

(i) solicit, offer employment to, or take any other action intended (or that a reasonable person acting in like circumstances would expect) to have the effect of causing any officer or employee of the Bank, the Company or any of their respective subsidiaries or affiliates to terminate his or her employment and accept employment or become affiliated with, or provide services for compensation in any capacity whatsoever to, any business whatsoever that competes with the business of the Bank or the Company or any of their direct or indirect subsidiaries or affiliates or has headquarters or offices within the counties in which the Bank or the Company has business operations or has filed an application for regulatory approval to establish an office; or

(ii) solicit, provide any information, advice or recommendation or take any other action intended (or that a reasonable person acting in like circumstances would expect) to have the effect of causing any customer of the Bank or the Company to terminate an existing business or commercial relationship with the Bank or the Company.

(b) The Executive hereby covenants and agrees that following any termination of employment, he shall not, without the written consent of the Bank, either directly or indirectly: become an officer, employee, consultant, director, independent contractor, agent, sole proprietor, joint venturer, greater than 5% equity-owner or stockholder, partner or trustee of any savings bank, savings and loan association, savings and loan holding company, credit union, bank or bank holding company, insurance company or agency, any mortgage or loan broker or any other entity that has its main office, or a majority of its branch offices, east of the Shinnecock Canal. This restriction shall apply for one year following termination. Notwithstanding the foregoing, the restriction contained in this Section 11(b) shall not apply if the Executive’s employment is terminated following a Change in Control.

9

(c) Executive shall, upon reasonable notice, furnish such information and assistance to the Bank and/or the Company, as may reasonably be required by the Bank and/or the Company, in connection with any litigation in which it or any of its subsidiaries or affiliates is, or may become, a party; provided, however, that Executive shall not be required to provide information or assistance with respect to any litigation between the Executive and the Bank, the Company or any of its subsidiaries or affiliates.

(d) All payments and benefits to the Executive under this Agreement shall be subject to the Executive’s compliance with this Section. The parties hereto, recognizing that irreparable injury will result to the Bank, its business and property in the event of the Executive’s breach of this Section 11, agree that, in the event of any such breach by the Executive, the Bank and/or the Company will be entitled, in addition to any other remedies and damages available, to an injunction to restrain the violation hereof by the Executive and all persons acting for or with the Executive. The Executive represents and admits that the Executive’s experience and capabilities are such that the Executive can obtain employment in a business engaged in other lines and/or of a different nature than the Bank, and that the enforcement of a remedy by way of injunction will not prevent the Executive from earning a livelihood. Nothing herein will be construed as prohibiting the Bank and the Company from pursuing any other remedies available to them for such breach or threatened breach, including the recovery of damages from the Executive.

12. Regulatory Requirements

(a) Notwithstanding anything herein contained to the contrary, any payments to Executive by the Bank and/or the Company, whether pursuant to this Agreement or otherwise, are subject to and conditioned upon their compliance with Section 18(k) of the Federal Deposit Insurance Act, 12 U.S.C. Section 1828(k), and the regulations promulgated thereunder in 12 C.F.R. Part 359.

(b) Notwithstanding any other provision in this Agreement, (i) the Bank or the Company may terminate or suspend this Agreement and the employment of the Executive hereunder, as if such termination were a Termination for Cause under Section 8(a) hereof, to the extent required by federal or state laws or regulations related to banking, to deposit insurance or bank holding companies or by regulations or orders issued by the Comptroller of the Currency, the Federal Deposit Insurance Corporation or the Board of Governors of the Federal Reserve System and (ii) no payment shall be required to be made to Executive under this Agreement to the extent such payment is prohibited by applicable law regulation or order issued by a banking agency or a court of competent jurisdiction; provided, that it shall be the Bank’s or the Company’s burden to prove that any such action was so required.

10

13. Arbitration; Legal Fees.

(a) Arbitration. In the event that any dispute should arise between the parties as to the meaning, effect, performance, enforcement, or other issue in connection with this Agreement, which dispute cannot be resolved by the parties, the dispute shall be decided by final and binding arbitration of a panel of three arbitrators. Proceedings in arbitration and its conduct shall be governed by the rules of the American Arbitration Association (“AAA”) applicable to commercial arbitrations (the “Rules”) except as modified by this Section. The Executive shall appoint one arbitrator, the Bank shall appoint one arbitrator, and the third shall be appointed by the two arbitrators appointed by the parties. The third arbitrator shall be impartial and shall serve as chairman of the panel. The parties shall appoint their arbitrators within thirty (30) days after the demand for arbitration is served, failing which the AAA promptly shall appoint a defaulting party’s arbitrator, and the two arbitrators shall select the third arbitrator within fifteen (15) days after their appointment, or if they cannot agree or fail to so appoint, then the AAA promptly shall appoint the third arbitrator. The arbitrators shall render their decision in writing within thirty (30) days after the close of evidence or other termination of the proceedings by the panel, and the decision of a majority of the arbitrators shall be final and binding upon the parties, nonappealable, except in accordance with the Rules and enforceable in accordance with the applicable state law. Any hearings in the arbitration shall be held in Suffolk County, New York unless the parties shall agree upon a different venue, and shall be private and not open to the public. Each party shall bear the fees and expenses of its arbitrator, counsel, and witnesses, and the fees and expenses of the third arbitrator shall be shared equally by the parties. The other costs of the arbitration, including the fees of AAA, shall be borne as directed in the decision of the panel.

(b) Legal Fees and Other Expenses. If the Executive is successful on the merits of the dispute, as determined in the arbitration, all legal fees and such other expenses as reasonably incurred by the Executive as a result of or in connection with or arising out of the dispute, shall be paid by the Bank and/or the Company, provided that such payment or reimbursement is made by the Bank not later than two and one-half months after the end of the year in which such dispute is resolved in Executive’s favor.

14. Indemnification and Insurance. The Bank and/or the Company shall provide the Executive (including his heirs, executors and administrators) with coverage under a standard directors’ and officers’ liability insurance policy at its expense, and shall indemnify Executive (and his heirs, executors and administrators) to the fullest extent permitted under applicable law against all expenses and liabilities reasonably incurred by him in connection with or arising out of any action, suit or proceeding in which he may be involved by reason of his having been an officer of the Bank and/or the Company (whether or not he continues to be an officer at the time of incurring such expenses or liabilities), such expenses and liabilities to include, but not be limited to, judgments, court costs and attorneys’ fees and the cost of reasonable settlements (such settlements must be approved by the Board); provided, however, that neither the Bank nor the Company shall be required to indemnify or reimburse Executive for legal expenses or liabilities incurred in connection with an action, suit or proceeding arising from any illegal or fraudulent act committed by Executive. Any such indemnification shall be made consistent with Section 18(k) of the Federal Deposit Insurance Act, 12 U.S.C. §1828(k), and the regulations issued thereunder in 12 C.F.R. Part 359.

11

15. Notices. The persons or addresses to which mailings or deliveries shall be made may change from time to time by notice given pursuant to the provisions of this Section. Any notice or other communication given pursuant to the provisions of this Section shall be deemed to have been given (i) if sent by messenger, upon personal delivery to the party to whom the notice is directed; (ii) if sent by reputable overnight courier, one business day after delivery to such courier; (iii) if sent by facsimile, upon electronic or telephonic confirmation of receipt from the receiving facsimile machine and (iv) if sent by mail, three business days following deposit in the United States mail, properly addressed, postage prepaid, certified or registered mail with return receipt requested. All notices required or permitted to be given hereunder shall be addressed as follows:

If to the Executive:	Howard H. Nolan
	At the last address On file
If to the Company
and the Bank:	Bridgehampton National Bank
	2200 Montauk Highway
	Bridgehampton, New York 11932
	Attention: President and Chief Executive Officer

With a copy to:

Luse Gorman Pomerenk & Schick, PC
5335 Wisconsin Avenue, NW, Suite 400
Washington, DC 20015
Attention: John J. Gorman, Esq.

16. Amendment. No modifications of this Agreement shall be valid unless made in writing and signed by the parties hereto.

17. Miscellaneous.

(a) Notice of Termination. Any termination of Executive’s employment by the Bank and/or the Company shall be communicated in writing to the Executive, and any voluntary termination of employment by the Executive shall be communicated in writing to the Bank and/or the Company.

(b) Successors and Assigns. This Agreement will inure to the benefit of and be binding upon the Executive, his legal representatives and estate and intestate distributees, and the Company and the Bank, their successors and assigns, including any successor by merger or consolidation or a statutory receiver or any other person or firm or corporation to which all or substantially all of the assets and business of the Bank or the Company may be sold or otherwise transferred. Any such successor of the Bank or the Company shall be deemed to have assumed this Agreement and to have become obligated hereunder to the same extent as the Company and Bank, and the Executive’s obligations hereunder shall continue in favor of such successor.

(c) Severability. A determination that any provision of this Agreement is invalid or unenforceable shall not affect the validity or enforceability of any other provision hereof.

12

(d) Waiver. Failure to insist upon strict compliance with any terms, covenants or conditions hereof shall not be deemed a waiver of such term, covenant or condition. A waiver of any provision of this Agreement must be made in writing, designated as a waiver, and signed by the party against whom its enforcement is sought. Any waiver or relinquishment or any right or power hereunder at any one or more times shall not be deemed a waiver or relinquishment of such right or power at any other time or times.

(e) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, and all of which shall constitute one and the same Agreement.

(f) Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without reference to conflicts of law principles, except to the extent governed by federal law in which case federal law shall govern.

(g) Headings and Construction. The headings of sections in this Agreement are for convenience of reference only and are not intended to qualify the meaning of any Section. Any reference to a Section number shall refer to a Section of this Agreement, unless otherwise specified.

(h) Entire Agreement. This instrument contains the entire agreement of the parties relating to the subject matter hereof, and supersedes in its entirety any and all prior agreements, understandings or representations relating to the subject matter hereof.

(i) Source of Payments. All payments provided in this Agreement shall be timely paid in cash or check from the general funds of the Bank. The Company, however, unconditionally guarantees payment and provision of all amounts and benefits due hereunder to Executive and, if such amounts and benefits are not timely paid or provided by the Bank, such amounts and benefits shall be paid or provided by the Company.

13

IN WITNESS WHEREOF, the Bank and the Company have caused this Agreement to be executed and the Executive has hereunto set his hand, all as of the Effective Date specified above.

	EXECUTIVE
June 25, 2009	/s/ Howard H. Nolan
Date	Howard H. Nolan
	BRIDGE BANCORP, INC.
June 25, 2009	By:	/s/ Marcia Z. Hefter
Date		Marcia Z. Hefter
		Chairperson of the Board
	BRIDGEHAMPTON NATIONAL BANK
June 25, 2009	By:	/s/ Marcia Z. Hefter
Date		Marcia Z. Hefter
		Chairperson of the Board

14

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO RULE 13a-14(a)

I, Kevin M. O’Connor, certify that:

1) I have reviewed this quarterly report on Form 10-Q of Bridge Bancorp, Inc.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors:

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 6, 2009

/s/ Kevin M. O’Connor Kevin M. O’Connor

President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO RULE 13a-14(a)

I, Howard H. Nolan, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Bridge Bancorp, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15(d)-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors:

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 6, 2009

/s/ Howard H. Nolan Howard H. Nolan Senior Executive Vice President, Chief Financial Officer

EX-32.1

This certification is being furnished as required by Rule 13a-14(b) under the Securities Exchange Act of 1934 (the “Exchange Act”) and Section 1350 of Chapter 63 of Title 18 of the United States Code, and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liability of that section. This certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except as otherwise stated in such filing.

EXHIBIT 32.1

CERTIFICATION PURSUANT TO RULE 13a-14(b) 18 U.S.C. SECTION 1350,

As adopted pursuant to

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Bridge Bancorp, Inc. (the “Company”) on Form 10-Q for the period ended June 30, 2009 as filed with the Securities and Exchange Commission, (the “Report”), we, Kevin M. O’Connor, President and Chief Executive Officer of the Company and, Howard H. Nolan, Senior Executive Vice President and Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 6, 2009	/s/ Kevin M. O’Connor
	Kevin M. O’Connor
	President and Chief Executive Officer
	/s/ Howard H. Nolan
	Howard H. Nolan
	Senior Executive Vice President, Chief Financial Officer