TERMINATION OF EMPLOYMENT AGREEMENT

                  THIS AGREEMENT (the "Agreement"),  dated as of March 31, 2000,
as set forth below,  terminates the Employment  Agreement  dated as of March 19,
1997 but effective as of January 1, 1997 (the "Employment  Agreement"),  between
JeffBanks,  Inc.  ("JeffBanks")  and Betsy Z.  Cohen (the  "Executive"),  and is
entered  into among  Betsy Z. Cohen,  individually,  and Hudson  United  Bancorp
("Hudson"), for itself and in its capacity as successor by merger to JeffBanks.

                  WHEREAS,  the Executive is entitled to certain  benefits under
the Employment Agreement; and

                  WHEREAS,  the parties hereto wish to evidence their  agreement
with respect to the matters set forth herein,

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

                  1. Full  Payment of Severance  Benefits.  Subject to the terms
hereof,  Executive  agrees to accept in complete  satisfaction  of her Severance
Benefits under the Employment Agreement the amount of $1,200,000, which shall be
paid (subject to normal income tax withholding) to Executive by wire transfer on
the execution of this Agreement.

                  2. Payment for Life Insurance Obligation and for Bonus Owed.

                           (a) Hudson and Executive  acknowledge  and agree that
JeffBanks was obligated under Section 5.c of the Employment Agreement to pay the
cost of certain life  insurance  premiums  during the period of the  Executive's
employment, that such premiums were not paid for the period from January 1, 1997
through  March  31,  2000,  and that the  Executive  did not  waive her right to
receive that benefit.  Hudson and Executive further agree that Hudson shall make
a payment  to the  Executive  of the  amount  of  $43,000,  which  shall be paid
(subject to normal income tax  withholding) to Executive by wire transfer on the
execution of this Agreement, and that such payment shall be in full satisfaction
of the obligations of Hudson under Section 5.c of the Employment Agreement.

                           (b) Hudson  acknowledges  that it is obligated  under
the  Employment  Agreement to pay, and the Executive  hereby agrees to accept in
complete satisfaction of such obligation,  a bonus for services rendered through
March 31, 2000 in the amount of $43,725,  which shall be paid (subject to normal
income tax  withholding)  to Executive by wire transfer on the execution of this
Agreement.

                  3. Termination of Employment Agreement. As of the date hereof,
the  Employment  Agreement  is  completely  terminated,  except  as set forth in
Sections 3(a)and 3(b) below:

                           (a) The  parties  believe  that as a  result  of this
Agreement,  no "Gross-Up  Payment" will be due under Section 8 of the Employment
Agreement.  Nonetheless, due to the uncertainties of the application of Sections
280G and 4999 of the  Internal  Revenue Code of 1986,  as amended (the  "Code"),
Section 8 of the Employment  Agreement shall continue in effect and Hudson shall
remain  responsible to make the payments due to the Executive under Section 8 of
the  Employment  Agreement as if all  payments  and  benefits  received or to be
received  by  Executive  from  Hudson  in  connection  with the  termination  of
Executive's employment were to be covered by such Section 8. Such payments shall
be made to the Executive,  or on the Executive's behalf directly to the Internal
Revenue  Service,  promptly,  and in no  event  more  than 10  days,  after  the
Executive  advises  Hudson that the  Internal  Revenue  Service has notified the
Executive  that she is subject to an  employment,  excise or income tax to which
she would not have been subject had  Sections  280G or 4999 of the Code not been
part of the Code (provided that if Hudson  acknowledges  such obligation  within
such 10 day period in a notice to the Executive in form and substance reasonably
satisfactory   to  the  Executive  and  if  the  Executive  is  not   materially
disadvantaged by the deferral  described in this  parenthetical  clause,  Hudson
shall  have the  right to defer  such  payment  for the  period of time in which
Hudson  actively  challenges  (in good faith) before an  appropriate  court such
determination  by the  Internal  Revenue  Service).  It is the  intention of the
parties (and Hudson  agrees that it shall  promptly  take all steps and promptly
make all payments to the Executive or on the  Executive's  behalf  necessary) to
assure that the  Executive's  net after tax position  (after taking into account
any interest or  penalties  imposed with respect to such taxes) upon the receipt
of payments in connection  with the  termination of her  employment  shall be no
less  advantageous  to the Executive  than would have been obtained had Sections
280G and 4999 of the Code not been  applicable  with  respect to such  payments.
Furthermore,  Hudson agrees to reimburse the Executive for the  reasonable  fees
and expenses of the  Executive's  Tax Counsel in accordance with Section 8(a) of
the  Employment  Agreement  and for the  reasonable  fees  and  expenses  of the
Executive's  attorneys  and for court and related  costs in any  proceedings  to
enforce the provisions of this Section 3(a) in which the Executive is successful
on the merits.

                           (b)  The  termination  of  the  Employment  Agreement
hereunder shall not affect the Executive's  rights under the "SERP"  established
by Section 5.b of the Employment  Agreement,  nor the Executive's  rights to the
"Welfare Benefits"  established by Section 7.d(ii) of the Employment  Agreement,
nor the Executive's rights to  indemnification  established by Section 10 of the
Employment Agreement.

                  4. Termination of Stock Options.  The parties  acknowledge and
agree that all  options  to  acquire  stock of  JeffBanks  or Hudson  previously
granted to the Executive expire automatically upon the execution and delivery of
this Agreement and that Executive shall have no further rights thereunder.

                  5. Binding Nature; Successors. This Agreement shall be binding
upon and shall inure to the benefit of the parties  hereto and their  successors
and assigns,  including  without  limitation  the estate of the Executive in the
event of the Executive's death; provided, however, that in no event shall Hudson
assign its  obligations  hereunder  without the express  written  consent of the
Executive.  Hudson will  require any  subsequent  successor  (whether  direct or
indirect,   by  purchase,   merger,   consolidation  or  otherwise)  to  all  or
substantially  all of the business  and/or assets of Hudson to assume  expressly
and agree to perform  this  Agreement  in the same manner and to the same extent
that  Hudson  would be required  to perform it if no such  succession  had taken
place.

                  6. Jurisdiction; Service. The federal and state courts located
within the State of New Jersey shall have exclusive jurisdiction with respect to
any legal proceeding brought to enforce any aspect of this Agreement. Service of
process may be effected by regular mail to the corporate  headquarters of Hudson
and to the last known residence address of the Executive.

                  IN WITNESS  WHEREOF,  the parties have executed this Agreement
as of the date set forth above.

                              HUDSON UNITED BANCORP


                              By:  ____________________________
                                   Name:
                                   Title:


                                  _____________________________
                                  Betsy Z. Cohen, Individually