Exhibit 10.4

                     PEAPACK-GLADSTONE EMPLOYMENT AGREEMENT
                              OF ARTHUR BIRMINGHAM

            This  EMPLOYMENT  AGREEMENT  (this  "Agreement") is as of January 1,
2006,  by and  between  Peapack-Gladstone  Financial  Corporation  ("PGFC")  and
Peapack-Gladstone Bank (the "Bank") (PGFC and the Bank are collectively referred
to herein as the "Company"), and Arthur Birmingham (the "Executive"), whose home
address is 14 Apgar Avenue, Gladstone, NJ 07934.

                                   WITNESSETH:

            WHEREAS,  the  Executive  is  willing  to  continue  to serve as the
Executive  Vice  President  and Chief  Financial  Officer of the Company and the
Company  desires  to retain  the  Executive  in that  capacity  on the terms and
conditions herein set forth; and

            NOW,  THEREFORE,  in consideration of the mutual covenants contained
herein, the parties agree as follows:

            Section 1. Term of Employment.  This Agreement shall be effective as
of the date hereof and,  subject to earlier  termination  as  specified  herein,
shall continue until December 31, 2006 (the "Term").

            Section 2. Position and Duties. During the Term, the Executive shall
serve as the President of the Company.  The Executive shall have such powers and
duties as are  commensurate  with such position and as may be conferred upon him
by the Board of  Directors of the Company (the  "Board").  During the Term,  the
Executive  shall devote all of his business time,  attention,  skill and efforts
exclusively  to the  business  and affairs of the Company and its  subsidiaries.
Notwithstanding   the  foregoing,   the  Executive  may  engage  in  charitable,
educational,   religious,  civic  and  similar  types  of  activities,  speaking
engagements,  membership on the board of directors of other  organizations,  and
similar  activities  to the  extent  that such  activities  do not  inhibit  the
performance  of his duties  hereunder  or conflict in any  material way with the
business of the Company and its subsidiaries.

            Section 3. Compensation.  For all services rendered by the Executive
in  any  capacity  required  hereunder  during  the  Term,  including,   without
limitation,  services  as an  executive  officer,  director,  or  member  of any
committee  of the Company or any of its  subsidiaries,  the  Executive  shall be
compensated as follows:

            (a) The Company shall pay the Executive a fixed salary at a rate per
annum  equal to  $169,645.82  ("Base  Salary").  Base  Salary  shall be  payable
bi-weekly.

            (b) The Executive  shall be eligible to receive a bonus with respect
to the Term. The amount,  terms and conditions of such bonus shall be determined
in due course by the Board.

            (c) The  Executive  shall be  entitled  to five weeks of vacation in
each  calendar  year  during the Term.  The  Executive  shall not be entitled to
carryover  vacation from one year to another or to any payment in respect of any
unused vacation.

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            (d)  The  Executive   shall  be  entitled  to   participate  in  all
compensation and employee benefit plans for which any salaried  employees of the
Company are eligible.  Notwithstanding the foregoing,  nothing in this Agreement
shall preclude the amendment or termination of any such plan or program.

            Section 4. Business Expenses. The Company shall pay or reimburse the
Executive for all reasonable entertainment, travel or other expenses incurred by
the  Executive  in  connection  with the  performance  of his duties  under this
Agreement,  subject to the Executive's presentation of appropriate documentation
in  accordance  with  such  procedures  as the  Company  may  from  time to time
establish.

            Section 5. Termination of Employment.

            (a) The  Company  shall have the  right,  upon  delivery  of written
notice to the Executive, to terminate the Executive's employment hereunder prior
to the expiration of the Term:

                  (i) pursuant to a Termination for Cause, or

                  (ii) upon the Executive's Permanent Disability, or

                  (iii) pursuant to a Without Cause Termination.

            (b) The  Executive  shall have the right,  upon  delivery of written
notice to the Company 30 days in advance of the proposed  termination  date,  to
terminate the  Executive's  employment  hereunder prior to the expiration of the
Term in the Executive's sole discretion.

            (c)   The   Executive's   employment   hereunder   shall   terminate
automatically without action by any party hereto upon the Executive's death.

            (d) For purposes of this  Agreement,  the  following  terms have the
following meanings:

            "Termination  for  Cause"  means a  termination  of the  Executive's
      employment by the Company because the Executive has (a) materially  failed
      to perform the duties  assigned to him  hereunder  or imposed  upon him by
      applicable  law,  and such  failure to perform  constitutes  self-dealing,
      willful misconduct or recklessness,  (b) committed an act of dishonesty in
      the performance of his duties  hereunder or engaged in conduct  materially
      detrimental to the business of the Company, (c) been convicted of a felony
      or a misdemeanor  involving  moral  turpitude,  (d)  materially  failed to
      perform his duties hereunder,  which breach or failure the Executive shall
      fail to remedy within 30 days after written  demand from the Company,  (e)
      knowingly failed to follow lawful, written directives of the Board, or (f)
      engaged in any  material  employment  act or practice,  including  but not
      limited to sexual  harassment,  forbidden by the Company in its employment
      manual as revised from time to time.

            "Without Cause  Termination"  means a termination of the Executive's
      employment  by  the  Company  other  than  due  to  Permanent  Disability,
      retirement  or  expiration  of the Term and other than a  Termination  for
      Cause.

            "Permanent  Disability" means permanently  disabled so as to qualify
      for full benefits under the Company's  then-existing  disability insurance
      policy.  If the Company  does not  maintain any such policy on the date of
      termination,  "Permanent  Disability"  shall  mean  the  inability  of the
      Executive  to work for a period of four full  calendar  months  during any
      eight consecutive calendar months due to

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      illness  or  injury  of a  physical  or mental  nature,  supported  by the
      completion   by  the   Executive's   attending   physician  of  a  medical
      certification form outlining the disability and treatment.

            Section 6. Benefits Upon Termination.

            (a) In lieu of any  severance  that may  otherwise be payable to the
Executive pursuant to any policies of the Company,  whether existing on the date
hereof or in effect from time to time  hereafter,  in the event that the Company
terminates the Executive's  employment  pursuant to a Without Cause Termination,
the Company shall continue to pay the Executive's  Base Salary for a period (the
"Severance Period") equal to the longer of (A) the remainder of the Term, or (B)
one year from the effective date of such  termination.  The Executive also shall
be entitled to any earned but unpaid  Base  Salary as of the  effective  date of
termination  of  employment.  No  other  payments  shall be  made,  or  benefits
provided,  by the Company under this Agreement  except as otherwise  required by
law or the Company's benefit plans.

            (b) In  the  event  that  the  Company  terminates  the  Executive's
employment  pursuant  to a  Permanent  Disability,  the  Company  shall  pay the
Executive  any earned but unpaid  Base Salary as of the date of  termination  of
employment.  No other  payments  shall be made,  or  benefits  provided,  by the
Company  under  this  Agreement  except  as  otherwise  required  by  law or the
Company's benefit plans.

            (c) In  the  event  that  the  Company  terminates  the  Executive's
employment  pursuant to a Termination for Cause or the Executive  terminates his
employment  with the Company  (including,  without  limitation,  pursuant to any
retirement),  the  Company  shall pay the  Executive  any earned but unpaid Base
Salary as of the date of termination  of employment.  No other payments shall be
made, or benefits  provided,  by the Company  under this  Agreement or otherwise
except to the extent required by law or the Company's benefit plans.

            (d) In the  event  that  the  Executive's  employment  hereunder  is
terminated due to the Executive's  death,  the Company shall pay the Executive's
executor or other legal  representative  (the  "Representative")  any earned but
unpaid  Base  Salary  as of the  date of  termination  of  employment.  No other
payments shall be made, or benefits provided,  by the Company whether under this
Agreement or  otherwise  except to the extent  required by law or the  Company's
benefit plans.

            (e) Any  payments  to be  made or  benefits  to be  provided  by the
Company  pursuant to this Section 6 (other than in the event of the  Executive's
death or Permanent  Disability)  are subject to the receipt by the Company of an
effective  general  release  and  agreement  not to  sue,  in a form  reasonably
satisfactory to the Company and the Executive (the "Release")  pursuant to which
the Executive  agrees (i) to release all claims  against the Company and certain
related parties  (excluding claims for (x)  indemnification  under the Company's
Certificate of  Incorporation  or by-laws or (y) any severance  benefits payable
hereunder),  (ii) not to maintain any action,  suit, claim or proceeding against
the Company,  its subsidiaries  and affiliates and certain related parties,  and
(iii)  to be bound  by  certain  confidentiality  and  mutual  non-disparagement
covenants specified therein. Notwithstanding the due date of any post-employment
payment,  the Company  shall not be obligated  to make any  payments  under this
Section 6 until after the expiration of any revocation  period applicable to the
Release.

            (f) The  Executive  shall not be required to mitigate the  severance
payments  to be  made  to  him  hereunder  and if the  Executive  obtains  other
employment while receiving  severance payments hereunder he shall continue to be
entitled to the benefits of this Agreement.

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            Section 7. Confidential  Information.  The Executive and the Company
agree that all  information  pertaining to the affairs,  business,  clients,  or
customers of the Company or any of its subsidiaries, other than information that
the Company has previously made publicly available, is confidential  information
belonging to the Company and is a unique and valuable asset of the Company. Both
during the Term hereof and  thereafter,  the Executive  shall not, except to the
extent  reasonably  necessary in the  performance  of his duties for the Company
during the Term,  disclose any information  concerning the affairs,  businesses,
clients,  or  customers of the Company or its  subsidiaries,  or make use of any
such  information  for his own purposes or for the benefit of any other  person,
firm, or corporation.  All records, memoranda,  letters, books, papers, reports,
or other data,  and other records and  documents  relating to the Company or its
subsidiaries,  whether  made by the  Executive  or  otherwise  coming  into  his
possession, shall remain the property of the Company, no copies thereof shall be
made  which are not  retained  by the  Company,  and the  Executive  agrees,  on
termination  of his  employment  not to retain any copies and  deliver  all such
confidential information in his possession to the Company.

            Section 8. Non-Compete; Non-Solicitation.

            (a) During the period (the  "Restricted  Period")  commencing on the
termination  of his  employment  for any reason  whatsoever  during the Term and
ending two years  thereafter,  the Executive  shall not,  without  express prior
written  consent  of the  Company,  directly  or  indirectly,  own or  hold  any
proprietary  interest in, or be employed by or receive  remuneration  from,  any
corporation,  partnership, sole proprietorship or other entity (collectively, an
"entity") "engaged in competition" (as defined below) with the Company or any of
its subsidiaries (a "Competitor").  For purposes of the preceding sentence,  (i)
the term "proprietary  interest" means direct or indirect ownership of an equity
interest in an entity  other than  ownership of less than 2 percent of any class
stock in a  publicly-held  entity,  and (ii) an entity shall be considered to be
"engaged in  competition"  if such  entity is, or is a holding  company for or a
subsidiary  of an entity  which is  engaged  in the  business  of (A)  providing
banking, trust services,  asset management advice, or similar financial services
to consumers,  businesses  individuals  or other  entities,  and (B) the entity,
holding company or subsidiary maintains any physical offices for the transaction
of such business located within 50 miles of the main office of the Company.

            (b) During the Restricted  Period,  the Executive shall not, without
express prior written consent of the Company, solicit or assist any other person
in soliciting for the account of any  Competitor,  any customer or client of the
Company or any of its subsidiaries.

            (c) During the Restricted  Period,  the Executive shall not, without
the express prior written  consent of the Company,  directly or indirectly,  (i)
solicit  or assist  any third  party in  soliciting  for  employment  any person
employed  by  the  Company  or  any  of its  subsidiaries  at  the  time  of the
termination of the  Executive's  employment  (collectively,  "Employees"),  (ii)
employ,  attempt to employ or materially  assist any third party in employing or
attempting  to employ  any  Employee,  or (iii)  otherwise  act on behalf of any
Competitor to interfere with the relationship  between the Company or any of its
subsidiaries and their respective Employees.

            (d) The Executive  acknowledges  that the restrictions  contained in
this Section 8 are reasonable and necessary to protect the legitimate  interests
of the Company and that any breach by the Executive of any  provision  contained
in this Section 8 will result in  irreparable  injury to the Company for which a
remedy at law would be inadequate.  Accordingly, the Executive acknowledges that
the Company shall be entitled to temporary, preliminary and permanent injunctive
relief against the Executive in the event of any breach or threatened  breach by
the  Executive  of the  provisions  of this  Section 8, in addition to any other
remedy that may be  available to the Company  whether at law or in equity.  With
respect to any  provision  of this  Section 8 finally  determined  by a court of
competent  jurisdiction to be  unenforceable,  such court shall be authorized to
reform

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this Agreement or any provision  hereof so that it is enforceable to the maximum
extent  permitted  by law. If the  covenants of Section 8 are  determined  to be
wholly or partially unenforceable in any jurisdiction,  such determination shall
not be a bar to or in any way  diminish  the  Company's  right to  enforce  such
covenants   in  any  other   jurisdiction   and  shall  not  bar  or  limit  the
enforceability of any other provisions.

            (e) The  provisions of this Section 8 shall survive the  termination
of the Executive's employment with the Company for any reason whatsoever so long
as the  termination  of  employment  occurs  during  the  Term.  If  there is no
termination  of Executive's  employment  during the Term, the provisions of this
Section 8 shall expire and be of no further force and effect after the Term. The
Company  shall not be required to post any bond or other  security in connection
with any proceeding to enforce the provisions of this Section 8.

            Section 9.  Withholdings.  The  Company may  directly or  indirectly
withhold from any payments made under this Agreement all Federal, State, City or
other taxes and all other deductions as shall be required pursuant to any law or
regulation  or pursuant to any  contributory  benefit plan  maintained  by or on
behalf of the Company.

            Section  10.  Notices.  All  notices,  requests,  demands  and other
communications  required or  permitted  hereunder  shall be given in writing and
shall be deemed to have been duly given if delivered or mailed, postage prepaid,
by same day or overnight mail (i) if to the Executive,  at the address set forth
above, or (ii) if to the Company, as follows:

            Frank A. Kissel, Chairman & CEO
            Peapack-Gladstone Bank
            158 Route 206 North
            Gladstone, NJ 07934

or to such other address as either party shall have previously specified in
writing to the other.

            Section 11. Binding Agreement;  Assignment.  This Agreement shall be
binding  upon and shall inure to the benefit of, the  Executive  and the Company
and its  successors  and permitted  assigns.  This  Agreement is personal to the
Executive  and may not be assigned by him. The Company may assign its rights and
obligations   under  this  Agreement  in  connection  with  a  sale  of  all  or
substantially  all of the  business of PGFC or the Bank.  Any  successor  to the
Company by merger or  consolidation  shall be entitled  to the  benefits of this
Agreement.

            Section 12.  Governing Law. This Agreement shall be governed by, and
construed in  accordance  with,  the  internal  laws of the State of New Jersey,
without reference to the choice of law principles thereof.

            Section 13. Dispute Resolution.  At the option of either the Company
or the Executive, any dispute,  controversy or question arising under, out of or
relating  to this  Agreement,  the  Executive's  employment  or  termination  of
employment,  including but not limited to any and all statutory claims involving
workplace discrimination or wrongful discharge, but excluding claims pursuant to
Sections 7 or 8 hereof,  shall be referred  for decision by  arbitration  in the
State of New Jersey by a neutral  arbitrator  mutually  selected  by the parties
hereto.  Any  arbitration  proceeding  shall  be  governed  by the  Rules of the
American  Arbitration  Association then in effect or such last in effect (in the
event such Association is no longer in existence).  If the parties are unable to
agree upon such a neutral arbitrator within 21 days after either party has given
the other written notice of the

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desire to submit the dispute, controversy or question for decision as aforesaid,
then either party may apply to the American Arbitration  Association for a final
and binding appointment of a neutral arbitrator; however, if such Association is
not then in existence  or does not act in the matter  within 45 days of any such
application, either party may apply to a judge of the local court where the Bank
is headquartered for an appointment of a neutral  arbitrator to hear the parties
and such judge is hereby authorized to make such appointment.  In the event that
either party  exercises the right to submit a dispute,  controversy  or question
arising hereunder to arbitration,  the decision of the neutral  arbitrator shall
be final,  conclusive and binding on all interested persons and no action at law
or in equity shall be instituted or, if instituted, further prosecuted by either
party other than to enforce the award of the  neutral  arbitrator.  The award of
the neutral  arbitrator may be entered in any court that has  jurisdiction.  The
Executive  and the Company  shall each bear all their own costs  (including  the
fees  and  disbursements  of  counsel)  incurred  in  connection  with  any such
arbitration and shall each pay one-half of the costs of any arbitrator.

            Section 14. Entire  Agreement.  This Agreement shall  constitute the
entire  agreement  among the parties with respect to the matters  covered hereby
and shall supersede all previous written,  oral or implied  understandings among
them with respect to such matters.

            Section  15.  Amendments.  This  Agreement  may only be  amended  or
otherwise modified, and compliance with any provision hereof may only be waived,
by a writing  executed  by all of the parties  hereto.  The  provisions  of this
Section 15 may only be amended or otherwise modified by such a writing.

            Section  16.  Counterparts.  This  Agreement  may be executed in any
number of counterparts, each of which shall be deemed to be an original, and all
of which shall together be deemed to constitute one and the same instrument.

            Section 17. Effect on Change-in-Control  Agreement.  Notwithstanding
anything  else to the  contrary  in  this  Agreement,  if the  Change-in-Control
Agreement between the Company and the Executive,  dated as of December 11, 2003,
becomes  effective under Section 13b thereof due to a  Change-in-Control  of the
Company  (as  defined  therein),  while the  Executive  remains  employed by the
Company, this Agreement, including, without limitation, Sections 7 and 8 hereof,
shall no longer be effective in any respect but instead the relationship between
the  Executive  and the  Company  shall  be  governed  by the  Change-in-Control
Agreement.  If the Executive is terminated prior to a  Change-in-Control  of the
Company,  then  Sections 7 and 8 hereof shall survive the  Change-in-Control  in
accordance with the terms of Sections 7 and 8 hereof.

            IN WITNESS WHEREOF,  PGFC and the Bank have caused this Agreement to
be  duly  executed  by the  undersigned,  thereunto  duly  authorized,  and  the
Executive has signed this Agreement, all as of the date first written above.

WITNESS                             PEAPACK-GLADSTONE FINANCIAL CORPORATION
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                                    By: /s/ Bridget J. Walsh
----------------------------           ---------------------------
Secretary                              Bridget J. Walsh

                                    PEAPACK-GLADSTONE BANK

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                                    By: /s/ Arthur F. Birmingham
----------------------------           ---------------------------
Secretary


                                    /s/ Arthur F. Birmingham
----------------------------        ------------------------------
                                    EXECUTIVE