Boardwalk Bancorp Inc - Proxy Statement - Merger or Acquistion (definitive) (DEFM14A)

Proposal 1 – Approval and Adoption of the Merger Agreement

The Merger

The following discussion of the merger is qualified by reference to the merger agreement, which is attached to this proxy statement-prospectus as Appendix A. You should read the entire merger agreement carefully. It is the legal document that governs the merger.

Terms of the Merger

The merger agreement provides for a business combination in which Boardwalk Bancorp will merge with and into Cape Bancorp with Cape Bancorp as the surviving corporation in the merger. The merger agreement also provides for the merger of Boardwalk Bank with and into Cape Savings Bank, with Cape Savings Bank as the surviving institution.

As a result of the merger, except as noted below, each outstanding share of Boardwalk Bancorp common stock will be converted into the right to receive (i) 2.3 shares of Cape Bancorp common stock, or (ii) $23.00 in cash. Cape Bancorp will not issue fractions of shares of Cape Bancorp common stock, but instead will pay each holder of Boardwalk Bancorp common stock who would otherwise be entitled to a fraction of a share of Cape Bancorp common stock an amount in cash determined by multiplying that fraction by $10.00. The maximum aggregate value of all consideration to be paid to shareholders of Boardwalk Bancorp is approximately $100.1 million, including an after-tax cost of approximately $1.3 million to be paid to holders of options to purchase Boardwalk Bancorp common stock in exchange for the cancellation of such options. The merger agreement provides that 50% of the outstanding shares of Boardwalk Bancorp must be converted into Cape Bancorp common stock, with the balance of the outstanding Boardwalk Bancorp shares converted into cash. All elections of Boardwalk Bancorp shareholders are subject to the allocation and proration procedures described in the merger agreement. As a result of such proration, you may not receive cash or Cape Bancorp shares to the full extent that you elect. See “— Consideration to be Received in the Merger.” If there is a change in the number or classification of shares of Cape Bancorp outstanding as a result of a stock split, stock dividend, reclassification, recapitalization, or other similar transaction, the exchange ratio will be equitably adjusted.

To be able to offer Boardwalk Bancorp shareholders shares of Cape Bancorp common stock as part of the merger consideration, Cape Bancorp is conducting its initial offering in connection with the mutual-to-stock conversion of Cape Savings Bank. The merger will occur immediately after consummation of the offering. Failure to complete the offering will result in the termination of the merger, but failure to complete the merger will not necessarily terminate the offering. Among the conditions that must be satisfied before the merger can be consummated is the receipt of all required regulatory approvals and the approval of Boardwalk Bancorp shareholders. Cape Savings Bank has received conditional approval from the Federal Deposit Insurance Corporation and conditional approval from the New Jersey Department of Banking and Insurance in connection with the merger. Cape Savings Bank needs the approval of its voting depositors in order to consummate the conversion, including the stock offering.

Cape Bancorp intends to conduct its offering at the same time Boardwalk Bancorp is soliciting the approval of the merger from its shareholders and Cape Savings Bank is soliciting the approval of the offering from its depositors. Cape Bancorp is mailing its prospectus to potential investors on or around November 23, 2007. Boardwalk Bancorp is mailing this proxy statement to its shareholders soliciting their votes in favor of the merger on or around November 23, 2007, and Cape Savings Bank mailed its proxy statement to its depositors soliciting their votes in favor of the conversion on or around November 23, 2007. The offering will terminate on December 17, 2007 unless extended to a later date. Boardwalk Bancorp’s shareholders’ meeting is scheduled for January 4, 2008, and Cape Savings Bank’s depositors’ meeting is scheduled for January 4, 2008. Assuming Boardwalk Bancorp shareholders approve the merger, Cape Bancorp receives sufficient subscriptions to complete the offering and Cape Savings Bank and Cape Bancorp receive the approval of its voting depositors and all required regulatory approvals, it is expected the offering and merger will be consummated early in the first calendar quarter of 2008.

Under the merger agreement, the directors and officers of Cape Savings Bank and Cape Bancorp, serving at the time of the closing will continue to serve in such capacities after the merger is consummated. In addition, upon the

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completion of the merger, Michael D. Devlin, Agostino R. Fabietti and Thomas K. Ritter, each a current director of Boardwalk Bancorp, will be added to the boards of directors of each of Cape Savings Bank and Cape Bancorp.

Background and Negotiation of the Merger

Since commencing operations in July 1999, Boardwalk Bank’s business objective has been to be recognized as a reliable and responsive provider of high quality banking services to retail customers, small and mid-sized businesses, and professional practices located in Boardwalk’s market area of Atlantic, Cape May and Cumberland Counties, New Jersey. Boardwalk’s business strategy has focused on increasing the value of its franchise through a number of key elements, including expanding its presence in its market area by building a branch network to promote growth of the commercial loan portfolio, emphasizing and expanding the commercial loan portfolio by, among other things, hiring loan officers with substantial experience and contacts in Boardwalk’s market area, and striving to maintain strong asset quality. Net interest income has been the source of substantially all of Boardwalk’s operating income, and Boardwalk has not relied on traditional sources of fee income utilized by some community banks, such as fees from sales of insurance, securities, or investment advisory products or services.

Boardwalk’s market area is intensely competitive, and many of Boardwalk’s competitors are larger financial institutions with substantially greater financial and other resources. Such competition, coupled with a contracting net interest margin in the banking industry generally as a result of the interest rate environment and other factors, has resulted in recent earnings for Boardwalk, which, in the view of Boardwalk’s management, are acceptable under current market conditions, but not necessarily increasing at the desired rate. As a result of these factors, and discussions in the first quarter of 2007 between management and Boardwalk’s financial advisor on Boardwalk’s general business and objectives, management concluded that it might be advisable to preliminarily explore whether or not other parties had any interest in a business combination with Boardwalk in a price range that would provide substantial shareholder value. Management believed that, given Boardwalk’s market position, coupled with its earnings and asset growth histories, Boardwalk might be an attractive merger candidate for the right party. Boardwalk’s management accordingly authorized its financial advisor, Janney Montgomery Scott LLC, to contact a limited number of institutions to determine their preliminary levels of interest in discussing a business combination transaction with Boardwalk.

Based on the nature of the responses to the informal preliminary inquiries conducted by Janney, Boardwalk’s board of directors authorized Janney to prepare offering materials for distribution to three selected potential acquirors that might, in the view of management in consultation with Janney, have the most strategic interest in a business combination transaction with Boardwalk. Janney prepared the offering materials and, following the execution of confidentiality agreements, distributed materials in late April 2007 to the three institutions: Cape Savings; an out-of-state mutual thrift holding company; and an out-of-state bank holding company.

Each of the three financial institutions contacted submitted non-binding indication of interest letters on or about May 30, 2007. The bank holding company proposed consideration consisting of a mix of 65% stock and 35% cash, but at a price per share in a range lower than the prices offered by the two thrift institutions. Each of the thrift institutions offered a mix of 50% in stock (with a fixed exchange ratio) and 50% in cash in connection with, in the case of the mutual thrift holding company, a second-step conversion to a fully public holding company and, in the case of Cape Savings Bank, a first-step conversion to a mutual holding company form of organization. The nominal price per share proposed by the mutual holding company in its initial non-binding indication of interest was approximately 15% higher than the price proposed by Cape Savings Bank in its initial non-binding indication of interest. Cape Savings Bank subsequently increased its initial proposal orally by 5%.

On June 1, 2007, Janney met with members of Boardwalk’s senior management to discuss the preliminary non-binding indications of interest. Following that meeting, Janney had several telephone discussions with the three prospective parties to discuss their preliminary indications of interest. Janney inquired of the out-of-state bank holding company whether it would consider increasing its offer, but it indicated that it was unable to do so and it was mutually agreed to end further discussions with this party. Janney and members of senior management held in person meetings with Cape Savings Bank and the out-of-state mutual thrift holding company during the period from June 1, 2007 through June 11, 2007.

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Boardwalk’s board of directors met on June 11, 2007 with representatives of Janney to review the initial non-binding indication of interest letters received on or about May 30, 2007. Janney reviewed with the board written materials setting forth a comparison of the indications of interest from the two thrift institutions, a comparison of pricing multiples for each indication of interest, and preliminary financial and other information with respect to each party. Janney also reviewed with the Board certain historical information and data, including information on stock price performance, relating to existing mutual holding companies that had engaged in second-step conversion transactions (the transaction proposed by the out of state mutual thrift holding company) and to mutual thrifts that had engaged in first-step mutual holding company conversions (the transaction proposed by Cape Savings Bank). The information on post-conversion stock price performance for entities that had previously converted was relevant to the board’s stated interest in making a judgment as to the potential value, including potential long-term value, of any security that would be received by Boardwalk shareholders in a conversion transaction.

Following this meeting, at the direction of the board, Janney notified both the out-of-state mutual thrift holding company and Cape Savings Bank that Boardwalk was inclined to permit the mutual thrift holding company to commence due diligence. Thereafter, on June 13, 2007, Cape Savings Bank delivered an unsolicited revised indication of interest letter to Janney increasing its offer to $23.00 per share, the same per share offer as originally offered by the out-of-state mutual thrift holding company. Cape Savings Bank also agreed to fully convert to a stock form of ownership in connection with the transaction rather than converting to a mutual holding company form of organization in a first-step transaction as it had originally proposed.

As a result of the revised Cape Savings Bank indication of interest, Janney informed Cape Savings and the other party that they would each be permitted to make a personal presentation on June 18, 2007 to the Board of Directors and management of Boardwalk on their respective indications of interest and the potential merits to Boardwalk and its shareholders of a transaction with their institutions. Senior representatives from each institution and representatives of their financial advisors made separate off-site presentations to the full board of directors and management on June 18, 2007. Representatives from Janney, Boardwalk’s financial advisor, and a representative from Stevens & Lee, Boardwalk’s outside counsel, also attended each presentation. The presentations summarized the then-current terms of their proposals and included detailed information about their respective operating and financial histories and strategic plans. Each institution also reviewed the specific conversion process that it would undertake to complete the transaction and provided its views on how the conversion process might affect the long-term value of the security that would be received by Boardwalk shareholders in the transaction. Members of management and the board of directors asked a number of questions of each institution and its financial advisor about the institution’s historical financial performance, future business and operating plans and the conversion process. At the conclusion of each June 18 meeting, Boardwalk informed each institution that it intended to evaluate the information presented, permit each institution to undertake an on-site due diligence examination of Boardwalk, and select by the end of June a party with which to negotiate a definitive merger agreement.

Each party conducted an on-site due diligence examination of Boardwalk during the period from June 21, 2007 through June 24, 2007.

On June 26, 2007, Janney requested a final indication of interest proposal from each party. The out-of-state mutual thrift holding company submitted a revised indication of interest letter increasing its proposed merger consideration. Cape Savings Bank reaffirmed its indication of interest at $23.00 per share.

Boardwalk’s Board of Directors met on June 28, 2007 to review the two final proposals, and to select one of the parties with which to pursue negotiation of a definitive agreement. Representatives of Janney and a representative from Stevens & Lee attended this meeting. Presentations or remarks were made by management, Janney and Stevens & Lee. The matters covered in these presentations and remarks, and in the deliberations and questions by directors, included the financial terms of each proposal, an evaluation of the historical financial performance and earnings trends of each institution, the geographic market area of Boardwalk on a pro forma basis combined with each institution and the existing market presence and resources of each institution, the conversion process that would be applicable to each institution in order to effect the merger and the after-market stock price performance of converting thrift institutions in different types of transactions, the execution risk for each transaction, and the directors’ legal duties and responsibilities in evaluating the proposals. A substantial amount of discussion at the meeting related to the conversion process required for each institution to effect an acquisition of Boardwalk, particularly in connection with the appraisal process

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and the distinctions between a second-step conversion, which would be undertaken by the out-of-state mutual thrift holding company, and a full conversion, which would be undertaken by Cape Savings Bank.

At the conclusion of the June 28 meeting, based on an evaluation of the information presented, the board of directors determined to pursue the Cape Savings Bank proposal for a transaction at $23.00 per share consisting of 50% cash and 50% stock of a to-be-formed entity formed to effect the conversion of Cape Savings Bank. The board selected the Cape Savings Bank proposal over the proposal from the out-of-state mutual thrift holding company for a 50/50 cash-stock election merger, which was at a nominal price per share that was approximately 8.7% higher than the final Cape Savings Bank proposal, after lengthy deliberation based on the board’s judgment that the Cape Savings Bank proposal represented better long-term value for shareholders. In reaching its conclusion that the Cape Savings Bank proposal was in the best interests of Boardwalk and its shareholders and represented the better long-term value, individual directors articulated the following specific factors:

Following discussion and consideration of all questions at the June 28 meeting, each individual director was polled and the board unanimously directed management to begin discussion and negotiation of a definitive merger agreement with Cape Savings Bank.

On July 3, 2007, Luse Gorman Pomerenk & Schick, special counsel to Cape Savings Bank, provided a first draft of the proposed merger agreement to Stevens & Lee, outside counsel to Boardwalk. The parties and their advisors negotiated the terms of the definitive merger agreement and prepared and negotiated certain related documents, including employment and change in control agreements for certain of Boardwalk’s officers and certain documents relating to the conversion of Cape Savings Bank, through the week of July 16.

Representatives of Boardwalk and its financial advisor and counsel conducted due diligence on Cape Savings Bank on July 12, 2007.

On July 23, 2007, Boardwalk’s board of directors met to consider the terms of the definitive merger agreement that had been negotiated between the parties. Also attending the meeting were representatives from Janney and representatives from Stevens & Lee. At the meeting, Janney reviewed with the board the financial terms of the proposed merger and various financial analyses relating to the transaction. Stevens & Lee reviewed with the board the terms of the proposed merger agreement and related documents in detail, and also reviewed again the directors’ fiduciary duties in connection with the proposed transaction. At the meeting, Janney rendered their oral advice that the consideration to be paid in the merger was fair to Boardwalk’s shareholders from a financial point of view, and confirmed that they would deliver such opinion in writing as of the date of execution of the merger agreement. Following discussion and further deliberation and questions, the board of directors unanimously agreed to accept the merger agreement proposed by Cape Savings Bank substantially in the form presented to the board.

The parties executed the definitive merger agreement and related documents during the evening of July 26, 2007, and publicly announced the transaction the same evening.

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Recommendation of Boardwalk’s Board of Directors

After careful consideration, Boardwalk’s Board of Directors, by unanimous vote:

Boardwalk’s Reasons for the Merger

At its meeting on July 23, 2007, the Board of Directors of Boardwalk determined that the terms of the merger agreement are fair to and in the best interests of Boardwalk and its shareholders. In reaching its decision to approve the merger agreement and to recommend that Boardwalk shareholders vote to approve the merger agreement, the board of directors of Boardwalk consulted with its financial advisor with respect to the financial aspects and fairness of the transaction from a financial point of view and its legal counsel with respect to its legal responsibilities under the merger agreement. The board considered, among other things, the factors described above and the following factors:

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The Board of Directors also considered the following factors, among others:

The foregoing list of factors considered by Boardwalk’s board of directors is not exhaustive but does include all material factors considered by the board. The board of directors did not quantify or assign relative or specific weights to the various factors that it considered. Rather, the board based its recommendation on the totality of the information presented to it. In addition, individual members of the board of directors may have given differing importance to the various factors considered.

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After deliberating with respect to the proposed transaction with Cape Savings Bank and considering, among other things, the matters discussed above, Boardwalk’s board of directors unanimously approved and adopted the merger agreement and the transaction with Cape Savings Bank and recommends that Boardwalk’s shareholders vote to approve the merger agreement at the special meeting.

Opinion of Boardwalk Bancorp’s Financial Advisor

Pursuant to the terms of its agreement, Janney Montgomery Scott LLC was retained by Boardwalk Bancorp to act as its financial advisor in connection with a possible business combination with Cape Savings Bank. Boardwalk Bancorp selected Janney because of Janney’s knowledge of, experience with, and reputation in the financial services industry. Janney agreed to assist Boardwalk Bancorp in analyzing, structuring, negotiating and effecting a possible merger. Janney, as part of its investment banking business, continually engages in the valuation of financial institutions and their securities in connection with mergers and acquisitions and other corporate transactions.

Janney acted as financial advisor to Boardwalk Bancorp in connection with the proposed merger and participated in certain of the negotiations leading to the merger agreement. Boardwalk Bancorp’s board considered and approved the merger agreement at the July 23, 2007 board meeting. At the meeting, Janney delivered an oral opinion, subsequently confirmed in writing as of July 26, 2007, that the merger consideration was fair to Boardwalk Bancorp’s shareholders from a financial point of view.

The full text of Janney’s updated opinion is attached as Appendix B to this proxy statement-prospectus. Boardwalk Bancorp’s shareholders are urged to read the opinion in its entirety for a description of the procedures followed, assumptions made, matters considered, and qualifications and limitations on the review undertaken by Janney in rendering its opinion. The description of the opinion set forth below is qualified in its entirety by reference to the opinion.

Janney’s opinion speaks only as of the date of the opinion. The opinion was directed to the Boardwalk Bancorp Board of Directors and addresses only the fairness, from a financial point of view, of the consideration offered in the merger. It does not address the underlying business decision of Boardwalk Bancorp to proceed with the merger or any other aspect of the merger and does not constitute a recommendation to any Boardwalk Bancorp shareholder as to how such shareholder should vote at the special meeting with respect to the merger or the form of consideration a shareholder should elect in the merger or any other matter.

In rendering its opinion, Janney, among other things:

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Janney also discussed with certain members of senior management of Boardwalk Bancorp the business, financial condition, results of operations and prospects of Boardwalk Bancorp and held similar discussions with certain members of senior management of Cape Savings Bank regarding the business, financial condition, results of operations and prospects of Cape Savings Bank.

In performing its review and in rendering its opinion, Janney relied upon the accuracy and completeness of all of the financial and other information that was available to it from public sources, that was provided to it by Boardwalk Bancorp or Cape Savings Bank or their respective representatives or that was otherwise reviewed by Janney, and assumed such accuracy and completeness for purposes of rendering its opinion. Janney further relied on the assurances of management of Boardwalk Bancorp and Cape Savings Bank that they were not aware of any facts or circumstances that would make any of such information inaccurate or misleading. Janney has not been asked to and has not undertaken any independent verification of any such information and Janney does not assume any responsibility or liability for the accuracy or completeness thereof. Janney did not make an independent evaluation or appraisal of the specific assets, the collateral securing assets or the liabilities (contingent or otherwise) of Boardwalk Bancorp or Cape Savings Bank or any of their subsidiaries, or the collectibility of any such assets, nor has Janney been furnished with any such evaluations or appraisals. Janney did not make any independent evaluation of the adequacy of the allowance for loan losses of Boardwalk Bancorp or Cape Savings Bank or any of their subsidiaries nor has Janney reviewed any individual credit files and has assumed that their respective allowances for loan losses are adequate to cover such losses and will be adequate on a pro forma basis for the combined entity.

The earnings projections for Boardwalk Bancorp and Cape Savings Bank used and relied upon by Janney in certain of its analyses were based upon Boardwalk Bancorp’s internal financial projections prepared by and reviewed with management and were based on Cape Savings Bank’ internal financial projections prepared by and reviewed with management. The financial projections provided by management of Boardwalk Bancorp and Cape Savings Bank were prepared for internal purposes only and not with a view towards public disclosure. These projections, as well as other estimates used by Janney in its analyses, were based on numerous variables and assumptions that are inherently uncertain, and accordingly, actual results could vary materially from those set forth in such projections.

In performing its analyses, Janney also made numerous assumptions with respect to industry performance, business, economic and market conditions and various other matters, many of which cannot be predicted and are beyond the control of Boardwalk Bancorp and Cape Savings Bank and Janney. The analyses performed by Janney are not necessarily indicative of actual values or future results, which may be significantly more or less favorable than suggested by such analyses. Estimates of the values of companies do not purport to be appraisals or necessarily reflect the prices at which companies or their securities may actually be sold. Accordingly, these analyses and estimates are inherently subject to substantial uncertainty. Janney prepared its analyses solely for purposes of rendering its opinion and provided such analyses to the Boardwalk Bancorp board of directors on July 26, 2007. In addition, Janney’s opinion was among several factors taken into consideration by the Boardwalk Bancorp board of directors in making its decision to approve the merger agreement and the merger.

Janney’s opinion was necessarily based on financial, economic, market and other conditions as in effect on, and the information made available to it as of, the date of its opinion. Events occurring after the date of the opinion could materially affect the opinion. Janney has not undertaken to update, revise, reaffirm or withdraw its opinion or otherwise comment upon events occurring after the date thereof. Janney expressed no opinion herein as to what the value of Cape Savings Bank’s common stock will be when issued to Boardwalk Bancorp’s shareholders pursuant to the merger agreement or the prices at which Boardwalk Bancorp’s or Cape Savings Bank’s common stock may trade at any time.

In rendering its opinion, Janney performed a variety of financial analyses. The following is a summary of the material analyses prepared by Janney for its meeting with the Boardwalk Bancorp board on July 23, 2007. The summary is not a complete description of all the analyses underlying Janney’s opinion. The preparation of a fairness

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opinion is a complex process involving subjective judgments as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances. Therefore, a fairness opinion is not readily susceptible to partial analysis or summary description. Janney believes that its analyses must be considered as a whole and that selecting portions of the factors and analyses considered without considering all factors and analyses, or attempting to ascribe relative weights to some or all such factors and analyses, could create an incomplete view of the evaluation process underlying its opinion. The financial analyses summarized below include information presented in a tabular format. In order to fully understand the financial analyses, these tables must be read together with the accompanying text. The tables alone do not constitute a complete description of the financial analyses. Also, no company or transaction used in the comparable analyses listed below is identical to Boardwalk Bancorp or Cape Savings Bank and no transaction is identical to the merger. Accordingly, an analysis of comparable companies or transactions involves complex considerations and judgments concerning the differences in financial and operating characteristics of the companies and other factors that could affect the public trading values or merger transactions values, as the case may be, of Boardwalk Bancorp or Cape Savings Bank and the companies to which they are being compared.

Summary of Proposal. Janney reviewed the financial terms of the proposed transaction. Based on an implied transaction price per share of $23.00, 4,292,860 shares of Boardwalk Bancorp common stock outstanding and 441,900 options to purchase Boardwalk Bancorp common stock at a weighted average exercise price of $16.99, Janney calculated the aggregate merger consideration to be $101.4 million.

Based upon Boardwalk Bancorp’s financial information as of and for the twelve months ended March 31, 2007, Janney calculated the following ratios:

For purposes of Janney’s analyses, earnings per share were based on fully diluted earnings per share.

Stock Trading History. Janney reviewed the reported closing per share market prices and volume of the common stock of Boardwalk Bancorp and the relationship between the movements in the prices of Boardwalk Bancorp’s common stock to movements in certain stock indices, including the Nasdaq Bank Index, America’s Community Bankers Index, S&P 500 Index and to the weighted average (by market capitalization) performance of a peer group of publicly-traded financial institutions headquartered in New Jersey with assets between $350.0 million and $1.5 billion. The institutions included in these peer groups are identified in the section “Comparable Company Analysis” below.

During the one-year and three-year periods ended July 20, 2007, Boardwalk Bancorp’s common stock outperformed the Nasdaq Bank, America’s Community Bankers and Peer Group Indices. However, Boardwalk Bancorp underperformed the S&P 500 Index over both the one-year and three-year periods ending July 20, 2007.

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Comparable Company Analysis. Janney used publicly available information to compare selected financial and market trading information for Boardwalk Bancorp and a group of bank institutions headquartered in New Jersey selected by Janney. This peer group consisted of the following publicly traded bank institutions with total assets between $350.0 million and $1.5 billion:

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Janney used publicly available information to compare selected financial information for Cape Savings Bank and a group of mutual savings institutions headquartered in New Jersey selected by Janney. This peer group consisted of the following mutual savings institutions with total assets between $100.0 million and $1.2 billion:

For purposes of such analysis, the financial information used by Janney was as of and for the twelve months ended March 31, 2007. Stock price information was as of July 20, 2007. Certain financial data prepared by Janney, and as referenced in the tables presented below, may not correspond to the data presented in Boardwalk Bancorp’s and Cape Savings Bank’s historical financial statements, as a result of the different periods, assumptions and methods used by Janney to compute the financial data presented. The results of this analysis are summarized in the following table:

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Comparable Transactions Analysis. Janney reviewed certain financial data related to three groups of comparable bank transactions.

The first group of comparable transactions included twenty-eight acquisitions announced nationwide from July 1, 2006 to July 20, 2007, involving bank institutions with an asset size between $350.0 million and $650.0 million (which we refer to as the Nationwide transactions). The second group of transactions included twelve acquisitions of bank institutions headquartered in Delaware, Maryland, New Jersey, New York, Pennsylvania and Washington, D.C. announced from July 1, 2004 to July 20, 2007, with an asset size between $350.0 million and $650.0 million (which we refer to as the Mid-Atlantic transactions). The third group of comparable transactions included thirteen acquisitions of bank institutions announced nationwide from July 1, 2004 to July 20, 2007, with an asset size between $350.0 million and $650.0 million and tangible equity to tangible assets at announcement of greater than 10.0% (which we refer to as Well-Capitalized transactions).

Transaction multiples from the merger were derived from the $23.00 deal price per share and financial data of Boardwalk Bancorp as of and for the twelve months ended March 31, 2007. Janney compared these results with announced multiples for the aforementioned transactions. The results of the analysis are summarized in the following table:

Discounted Dividend and Terminal Value Analysis. Janney estimated the present value of Boardwalk Bancorp’s common stock by estimating the future stream of after-tax cash flows of Boardwalk Bancorp over the period beginning December 31, 2007 and ending December 31, 2012. Based on discussions with Boardwalk Bancorp’s management, a growth rate of approximately 9% was used to project earnings. To approximate the terminal values, Janney applied price/earnings multiples ranging from 15.0x to 17.0x and multiples of tangible book value ranging from 150% to 190%. The cash flows and terminal values were then discounted to present values using discount rates ranging from 11.0% to 15.0%. The discount rates were chosen to reflect different assumptions regarding required rates of return of holders or prospective buyers of Boardwalk Bancorp common stock. As illustrated in the following tables, this analysis indicated an imputed range of values from $12.71 to $16.99 when applying the price/earnings multiples and $10.97 to $16.07 when applying multiples of tangible book value.

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In connection with the discounted dividend and terminal value analysis performed, Janney considered and discussed with Boardwalk Bancorp’s board how the present value analysis would be affected by changes in the underlying assumptions, including variations with respect to the growth rate of assets, net income and the dividend payout ratio (the percentage of earnings per share payable to shareholders). Janney noted that the discounted dividend and terminal value analysis is a widely used valuation methodology, but the results are highly dependent upon the numerous assumptions that must be made, and the results thereof are not necessarily indicative of the actual values or expected values of Boardwalk common stock.

Financial Impact Analysis . Janney performed a pro forma merger analysis that combined projected balance sheet and income statement information of Cape Savings Bank and Boardwalk Bancorp. The analysis assumed that 50% of Boardwalk Bancorp’s shares were exchanged for shares of Cape Savings Bank common stock at an exchange ratio of 2.3 shares and that 50% of Boardwalk Bancorp’s shares were exchanged for cash of $23.00 per share. The analysis also contemplated certain purchase accounting adjustments, charges and transaction costs associated with the merger, as well as certain transaction synergies determined by the managements of Cape Savings Bank and Boardwalk Bancorp. The analysis assumed earnings projections consistent with internal projections as discussed with management of Boardwalk Bancorp and Cape Savings Bank. In addition, the analysis assumed that the 441,900 outstanding options to purchase Boardwalk Bancorp common stock were cashed out in amount equal to the difference between $23.00 and the weighted average exercise price of $16.99 per share.

In connection with its analyses, Janney considered and discussed with Boardwalk Bancorp’s board how the pro forma analyses would be affected by various changes in the underlying assumptions. Janney evaluated and discussed with Boardwalk Bancorp’s board the impact of the transaction on the pro forma company’s book value, tangible book value and earnings. Janney noted that the actual results achieved by the combined company may vary from the projected results and the variations may be material.

Boardwalk Bancorp has agreed to pay Janney a contingent transaction fee of approximately $963,000 in connection with the merger, of which 20% was paid upon the signing of the merger agreement. The balance of the fee is payable by no later than the closing of the transaction. Boardwalk Bancorp has also agreed to reimburse certain of Janney’s reasonable out-of-pocket expenses incurred in connection with its engagement and to indemnify Janney and its affiliates and their respective partners, directors, officers, employees, agents and controlling persons against certain liabilities.

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Janney has in the past provided certain investment banking services to Boardwalk Bancorp and has received compensation for such services and may provide, and receive compensation for, such services in the future. Furthermore, in the ordinary course of its business as a broker-dealer, Janney may, from time to time, have a long or short position in, and buy or sell, debt or equity securities of Boardwalk Bancorp for its own account or for the accounts of its customers.

The full text of the opinion of Janney Montgomery Scott, LLC, which is attached as Appendix B to this proxy statement-prospectus, sets forth certain assumptions made, matters considered and limitations on the review undertaken by Janney Montgomery Scott, LLC, and should be read in its entirety. The summary of the opinion of Janney Montgomery Scott, LLC set forth in this proxy statement is qualified in its entirety by reference to the opinion.

Janney has received compensation of $15,000 from Boardwalk Bancorp during the prior two fiscal years.

Form of the Merger

The Boards of Directors of Boardwalk Bancorp and Cape Savings Bank have approved the merger agreement which provides for the merger of Boardwalk Bancorp with and into Cape Bancorp and the merger of Boardwalk Bank with and into Cape Savings Bank Bank. Upon completion of the merger, each share of Boardwalk Bancorp common stock will be converted into the right to receive 2.3 shares of Cape Bancorp common stock or $23.00 in cash, without interest. A Boardwalk Bancorp shareholder’s receipt of cash or stock, however, is subject to the allocation and proration procedures as well as other provisions in the merger agreement. See “—Consideration to be Received in the Merger.”

The common stock of Cape Bancorp is expected to be traded on the Nasdaq Global Market under the symbol “CBNJ” upon conclusion of the stock offering and after completion of the merger.

Consideration to be Received in the Merger

When the merger becomes effective, each share of Boardwalk Bancorp common stock issued and outstanding immediately prior to the completion of the merger will automatically be converted into the right to receive, subject to the election and proration procedures outlined in the merger agreement, $23.00 in cash without interest or 2.3 shares of Cape Bancorp common stock.

Although shareholders of Boardwalk Bancorp are being given the option to elect whether to receive cash, Cape Bancorp common stock, or a combination of the two, in exchange for their shares of Boardwalk Bancorp common stock, all cash and stock elections will be subject to the allocation and proration procedures, as well as other provisions in the merger agreement. In particular, the number of Boardwalk Bancorp shares converted into the right to receive cash consideration will be 50% of the total outstanding Boardwalk Bancorp stock, and the number of Boardwalk Bancorp shares converted into the right to receive stock consideration shall be 50% of the total outstanding Boardwalk Bancorp shares. Based on 4,295,151 outstanding shares of Boardwalk Bancorp common stock, we expect to issue approximately 4,939,424 shares of our common stock to Boardwalk Bancorp shareholders in the merger. At June 30, 2007, there were 420,583 outstanding options to purchase shares of Boardwalk Bancorp common stock. If each of these options were exercised prior to the effective time of the merger, Cape Bancorp could issue as many as 5,423,094 shares of its common stock to Boardwalk Bancorp shareholders in the merger.

Neither Cape Bancorp nor Boardwalk Bancorp is making any recommendation as to whether Boardwalk Bancorp shareholders should elect to receive cash or Cape Bancorp common stock in the merger. Each holder of Boardwalk Bancorp common stock must make his or her own decision with respect to such election.

Finally, the number of Boardwalk Bancorp shares exchanged for cash and stock may need to be adjusted to ensure Boardwalk Bancorp’s shareholders will not receive fractional shares of Cape Bancorp common stock. Instead, they will receive a cash payment for any fractional shares in an amount equal to the product of such fractional amount multiplied by $10.00.

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See “The Conversion and Stock Offering” in the attached Cape Bancorp prospectus for a more detailed discussion on the number of shares to be issued in the offering and the merger, as well as the percentages of the shares of Cape Bancorp common stock that will be outstanding following the offering and the merger at the different points of the offering range.

It is unlikely that elections will be made in the exact proportion provided for in the merger agreement. As a result, the merger agreement describes procedures to be followed if Boardwalk Bancorp shareholders, in the aggregate, elect to receive more shares of Cape Bancorp common stock than Cape Bancorp has agreed to issue in the merger or fewer shares of Cape Bancorp common stock than must be issued in the merger. These procedures are summarized below.

No guarantee can be made that you will receive the amount of Cape Bancorp stock or cash you elect. As a result of the allocation procedures and other limitations outlined in this document and in the merger agreement, you may receive Cape Bancorp common stock and/or cash in an amount that varies from the amount you elect to receive.

Election Procedures; Surrender of Stock Certificates

A form for making an election of the consideration you wish to receive in the merger will be sent to you separately. The election form allows you to elect to receive Cape Bancorp common stock or cash, or a combination of both, or to make no election with respect to the merger consideration you wish to receive. For your election to be effective, your properly completed election form, along with your Boardwalk Bancorp stock certificates or an appropriate guarantee of delivery, must be received by Registrar and Transfer Company on or before 5:00 p.m., Eastern time, on January 4, 2008. Registrar and Transfer Company will act as exchange agent in the merger and in that role will process the exchange of Boardwalk Bancorp stock certificates for cash and/or Cape Bancorp common stock. Shortly after the merger, the exchange agent will allocate cash and stock among Boardwalk Bancorp shareholders, consistent with their elections and the allocation and proration procedures. If you do not submit an election form, you will receive instructions from the exchange agent on where to surrender your Boardwalk Bancorp stock certificates after the merger is completed. In any event, you should not forward your Boardwalk Bancorp stock certificates with your proxy cards.

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If you have a preference for receiving either Cape Bancorp common stock or cash in exchange for your Boardwalk Bancorp stock, you should complete and return the election form. If you do not make an election or indicate that you have no preference, you will be allocated Cape Bancorp common stock and/or cash based on the merger agreement’s allocation and proration procedures.

We are not recommending whether you should elect to receive Cape Bancorp common stock or cash in the merger. You must make your own decision with respect to your election. The United States federal income tax treatment will depend primarily on whether you exchange your Boardwalk Bancorp common stock solely for Cape Bancorp common stock, solely for cash, or for a combination of Cape Bancorp common stock and cash. See “—Material Federal Income Tax Consequences of the Merger.”

If certificates for Boardwalk Bancorp common stock are not immediately available or time will not permit the election form and other required documents to reach the exchange agent prior to the election deadline, Boardwalk Bancorp shares may be properly exchanged, and an election will be effective, if:

Boardwalk Bancorp shareholders who do not submit a properly completed election form or revoke their election form prior to the election deadline will have their shares of Boardwalk Bancorp common stock designated as “nonelection” shares . Boardwalk Bancorp stock certificates represented by elections that have been revoked will be promptly returned without charge to the Boardwalk Bancorp stockholder submitting the election form upon written request. After the completion of the merger, the exchange agent will allocate cash and Cape Bancorp common stock among the shareholders of Boardwalk Bancorp common stock according to the allocation procedures outlined above.

After the completion of the merger, the exchange agent will mail to Boardwalk Bancorp shareholders who do not submit election forms a letter of transmittal, together with instructions for the exchange of their Boardwalk Bancorp common stock certificates for the merger consideration. Until you surrender your Boardwalk Bancorp stock certificates for exchange after completion of the merger, you will not be paid dividends or other distributions declared after the merger with respect to any Cape Bancorp common stock into which your Boardwalk Bancorp shares may be converted. When you surrender your Boardwalk Bancorp stock certificates, Cape Bancorp will pay any unpaid dividends or other distributions, without interest. After the completion of the merger, there will be no further transfers of Boardwalk Bancorp common stock. Boardwalk Bancorp stock certificates presented for transfer after the completion of the merger will be canceled and exchanged for the merger consideration.

If your Boardwalk Bancorp stock certificates have been lost, stolen or destroyed, you will have to prove your ownership of these certificates and that they were lost, stolen or destroyed before you receive any consideration for your shares. Upon request, Registrar and Transfer Company will send you instructions and appropriate forms for this purpose.

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Treatment of Boardwalk Bancorp Stock Options

Immediately prior to the effective time of the merger (after all of the conditions to the consummation of the merger, as described in the merger agreement, have been satisfied), each outstanding option to purchase shares of Boardwalk Bancorp common stock granted under any of the Boardwalk Bancorp stock option plans, whether or not the options are then exercisable, will be cancelled in exchange for a cash payment from Boardwalk Bancorp. The cash payment for each option will be equal to the excess of the $23.00 merger consideration over the exercise price per share of each option multiplied by the number of shares subject to such option, net of any cash that must be withheld under the federal and state income and employment tax requirements.

Material Federal Income Tax Consequences of the Merger

The following discussion addresses the material United States federal income tax consequences of the merger to U.S. holders of Boardwalk Bancorp common stock. This discussion applies only to U.S. holders of Boardwalk Bancorp common stock that hold their Boardwalk Bancorp common stock as a capital asset within the meaning of Section 1221 of the Internal Revenue Code of 1986, as amended. Further, this discussion does not address all aspects of United States federal income taxation that may be relevant to a particular shareholder in light of his or her personal circumstances or to shareholders subject to special treatment under the United States federal income tax laws including: banks or trusts; tax-exempt organizations; insurance companies; regulated investment companies or mutual funds; dealers in securities or foreign currency; traders in securities who elect to apply a mark-to-market method of accounting; pass-through entities and investors in such entities; foreign persons; shareholders who hold Boardwalk Bancorp common stock as part of a hedge, straddle, constructive sale, conversion transaction or other integrated instrument; and to shareholders of Boardwalk Bancorp common stock who acquired their shares of Boardwalk Bancorp common stock upon the exercise of warrants or employee stock options or otherwise as compensation. For purposes of this summary, the term “U.S. holder” means:

If a partnership (including for this purpose any other entity treated as a partnership for United States federal income tax purposes) holds Boardwalk Bancorp common stock, the tax treatment of a partner will generally depend on the status of the partners and the activities of the partnership. If a U.S. holder is a partner in a partnership holding Boardwalk Bancorp common stock, such holder should consult its tax advisor.

This discussion is based on the Internal Revenue Code, Treasury regulations, administrative rulings and judicial decisions, all as in effect as of the date of this proxy statement-prospectus and all of which are subject to change (possibly with retroactive effect) and to differing interpretations. Tax considerations under state, local and foreign laws are not addressed in this document. The tax consequences of the merger to you may vary depending upon your particular circumstances. Therefore, you should consult your tax advisor to determine the particular tax consequences of the merger to you, including those relating to state and/or local taxes.

In connection with the filing of the registration statement of which this proxy statement-prospectus forms a part, Luse Gorman Pomerenk & Schick, P.C. has delivered to Cape Bancorp its opinion, that the merger will qualify as a “tax-free reorganization” within the meaning of Section 368(a) of the Internal Revenue Code. A copy of the tax opinion is attached as Exhibit 8 of the registration statement. Such opinion has been rendered on the basis of facts, representations or assumptions set forth or referred to in such opinion and the factual representations contained in

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certificates of officers of Cape Savings Bank and of Boardwalk Bancorp, all of which must continue to be true and accurate in all material respects as of the effective time of the merger.

No ruling has been sought from the Internal Revenue Service regarding the tax consequences of the merger. No assurance can be given that the Internal Revenue Service would not assert, or that a court would not sustain, a position contrary to any of the tax consequences set forth below.

Tax-Free Reorganization; Tax Treatment of the Entities . The Merger will constitute a tax-free reorganization for Federal income tax purposes within the meaning of Section 368(a)(1)(A) of the Internal Revenue Code meaning that no gain or loss will be recognized by Cape Bancorp, Cape Savings Bank, Boardwalk Bancorp, or Boardwalk Bank as a result of the merger provided that the continuity of interest requirement is met, as discussed below. In order for the merger to qualify as a tax-free reorganization, the transaction must satisfy a judicially-created doctrine whereby the shareholders of Boardwalk Bancorp must retain a significant ongoing interest in the combined entity. Under Internal Revenue Service rulings and guidelines, this “continuity of interest” test would require that the aggregate value of Cape Bancorp common stock issued in the merger to Boardwalk Bancorp shareholders is not less than 50% of the value of formerly outstanding shares of Boardwalk Bancorp common stock, in order for the Internal Revenue Service to make an advance ruling that the merger would qualify as a tax-free reorganization. However, although the Service applies a 50% guideline for advance ruling purposes, the Internal Revenue Service has acknowledged that the 50% guideline does not define, as a matter of law, the minimum stock consideration required to meet the continuity of interest test. The Internal Revenue Service issued regulations in 2005 adopting a 40% continuity of interest if the merger agreement provides for “fixed consideration” as defined in its regulations. The Service also has, in private letter rulings, found sufficient continuity of interest at the 45% level, and the courts have accepted lower levels of continuity, including thresholds of 38% and 25% stock consideration. As a condition to closing the merger, 50% of the outstanding shares of Boardwalk Bancorp common stock must be converted into shares of Cape Bancorp common stock.

Exchange of Boardwalk Bancorp Common Stock Solely for Cape Bancorp Common Stock . No gain or loss will be recognized by a Boardwalk Bancorp shareholder who receives solely shares of Cape Bancorp common stock (except to the extent that cash is received in lieu of fractional shares, as discussed below) in exchange for all of his or her shares of Boardwalk Bancorp common stock. The aggregate adjusted tax basis of the shares of Cape Bancorp common stock received by a Boardwalk Bancorp shareholder in such exchange will be equal (except for the basis attributable to any fractional shares of Cape Bancorp common stock, as discussed below) to the aggregate adjusted tax basis of the Boardwalk Bancorp common stock surrendered in exchange for the Cape Bancorp common stock. The holding period of the Cape Bancorp common stock received will include the holding period of shares of Boardwalk Bancorp common stock surrendered in exchange for the Cape Bancorp common stock, provided that such shares were held as capital assets of the Boardwalk Bancorp shareholder at the effective time of the merger.

Exchange of Boardwalk Bancorp Common Stock Solely for Cash. A Boardwalk Bancorp shareholder who receives solely cash in exchange for all of his or her shares of Boardwalk Bancorp common stock (and is not treated as constructively owning Cape Bancorp common stock after the merger under the circumstances referred to below under “—Possible Dividend Treatment “) will recognize gain or loss for federal income tax purposes equal to the difference, if any, between the cash received and such shareholder’s aggregate adjusted tax basis in the Boardwalk Bancorp common stock surrendered in exchange for the cash. Such gain or loss will be a capital gain or loss, provided that such shares were held as capital assets of the Boardwalk Bancorp shareholder at the effective time of the merger. Such gain or loss will be long-term capital gain or loss if the Boardwalk Bancorp shareholder’s holding period is more than one year. The Internal Revenue Code contains limitations on the extent to which a taxpayer may deduct capital losses from ordinary income.

Exchange for Cape Bancorp Common Stock and Cash . As a result of receiving a combination of Cape Bancorp common stock and cash in exchange for shares of Boardwalk Bancorp common stock, a Boardwalk Bancorp shareholder will recognize gain, but not loss, equal to the lesser of (1) the amount of cash received, or (2) the amount of gain “realized” in the merger. The amount of gain a Boardwalk Bancorp shareholder “realizes” will equal the amount by which (a) the cash plus the fair market value at the effective time of the merger of the Cape Bancorp common stock received exceeds (b) the shareholders’ aggregate adjusted tax basis in the Boardwalk Bancorp common stock surrendered in the merger. If a shareholder of Boardwalk Bancorp common stock purchased his or her shares of

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Boardwalk Bancorp common stock at different prices, such Boardwalk Bancorp stockholder will have to compute his or her recognized gain or loss separately for the shares of Boardwalk Bancorp common stock with a different adjusted basis in accordance with the applicable tax rules described in the previous sentences. Any recognized loss disallowed will be included in the adjusted basis of the holders of Cape Bancorp common stock received in the merger, as discussed below. Any recognized gain will be taxed as a capital gain or a dividend, as described below. The aggregate adjusted tax basis of the shares of Cape Bancorp common stock received in the merger will be the same as the aggregated adjusted tax basis of the shares of Boardwalk Bancorp common stock surrendered in the merger decreased by the amount of cash received in the merger and increased by the (i) gain recognized in the merger, if any, and (ii) recognized loss disallowed in the merger, if any. The holding period for shares of Cape Bancorp common stock received by such Boardwalk Bancorp shareholder will include such shareholder’s holding period for the Boardwalk Bancorp common stock surrendered in exchange for the Cape Bancorp common stock, provided that such shares of Boardwalk Bancorp common stock were held as capital assets of the shareholder at the effective time of the merger.

Possible Dividend Treatment . Any gain recognized by a Boardwalk Bancorp shareholder will be capital gain unless the Boardwalk Bancorp shareholder’s receipt of cash has the effect of a distribution of a dividend, in which case the gain will be treated as dividends to the extent of the shareholder’s ratable share of accumulated earnings and profits, as calculated for United States federal income tax purposes. For purposes of determining whether a Boardwalk Bancorp shareholder’s receipt of cash has the effect of a distribution of a dividend, the Boardwalk Bancorp shareholder will be treated as if it first exchanged all of its Boardwalk Bancorp common stock solely in exchange for Cape Bancorp common stock and then Cape Bancorp immediately redeemed a portion or all of that stock for the cash that the holder actually received in the merger (referred to herein as the “deemed redemption”). Receipt of cash will generally not have the effect of a distribution of a dividend of the Boardwalk Bancorp shareholder if such receipt is, with respect to the Boardwalk Bancorp shareholder, “not essentially equivalent to a dividend,” “substantially disproportionate” or a “complete redemption,” each within the meaning of Section 302(b) of the Internal Revenue Code.

The deemed redemption will not be “essentially equivalent to a dividend” and, therefore, will not have the effect of a distribution of a dividend with respect to a Boardwalk Bancorp shareholder if it results in a “meaningful reduction” in the holder’s proportionate interest in Cape Bancorp. If a holder that has a relatively minimal stock interest in Cape Bancorp and no right to exercise control over corporate affairs suffers a reduction in the holder’s proportionate interest in Cape Bancorp, the holder should be regarded as having suffered a meaningful reduction in the holder’s proportionate interest in Cape Bancorp. For example, the Internal Revenue Service has held in a published ruling that, in the case of a less than 1% shareholder who does not have management control over the corporation, any reduction in the shareholder’s proportionate interest will constitute a “meaningful reduction.” The Internal Revenue Service has also indicated in rulings that any reduction in the interest of a minority shareholder that owns a small number of shares in a publicly and widely held corporation and that exercises no control over corporate affairs would result in capital gain (as opposed to dividend) treatment.

The deemed redemption will be “substantially disproportionate,” and, therefore, will not have the effect of a distribution of a dividend with respect to a Boardwalk Bancorp shareholder who owns less than 50% of the voting power of the outstanding Cape Bancorp common stock if the percentage of the outstanding Cape Bancorp common stock that is actually and constructively owned by the holder immediately after the deemed redemption is less than 80% of the percentage of the outstanding Cape Bancorp common stock that is considered to be actually and constructively owned by the holder immediately before the deemed redemption.

The deemed redemption will be a “complete redemption,” and, therefore, will not have the effect of a distribution of a dividend with respect to a Boardwalk Bancorp shareholder, if it results in a complete termination of a shareholder’s interest in the outstanding Cape Bancorp common stock that is considered to be actually and constructively owned by the holder immediately before the deemed redemption.

For purposes of applying the foregoing tests, a shareholder will be deemed to own the stock it actually owns and the stock it constructively owns under the attribution rules of Section 318 of the Internal Revenue Code. Under Section 318 of the Internal Revenue Code, a shareholder will be deemed to own the shares of stock owned by certain family members, by certain estates and trusts of which the shareholder is a beneficiary and by certain affiliated entities, as well as shares of stock subject to an option actually or constructively owned by the shareholder or such other persons. In the event of a “complete redemption” within the meaning of Section 302(b) of the Internal Revenue Code, a shareholder may elect to waive the attribution rules of Section 318 of the Internal Revenue Code pursuant to Section 302(c) of the Code.

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If, after applying these tests, the deemed redemption results in a capital gain, the capital gain will be long-term if the Boardwalk Bancorp shareholder’s holding period for its Boardwalk Bancorp common stock is more than one year as of the date of the merger. Long-term capital gains recognized by an individual are generally subject to tax at reduced rates.

If, after applying these tests, the deemed redemption results in the gain recognized by a Boardwalk Bancorp shareholder being classified as a dividend, such dividend will be treated as either ordinary income or qualified dividend income. Any gain treated as qualified dividend income will be taxable to individual Boardwalk Bancorp shareholders at the long-term capital gains rate, provided that the shareholder held the shares giving rise to such income for more than 61 days during the 121 day period beginning 60 days before the closing date. Any gain treated as ordinary income will be taxable at ordinary income rates.

The determination of whether a cash payment will be treated as having the effect of a dividend depends primarily upon the facts and circumstances of each Boardwalk Bancorp shareholder. Boardwalk Bancorp shareholders are urged to consult their own tax advisors regarding the tax treatment of the cash received in the merger.

Cash in Lieu of Fractional Shares . A Boardwalk Bancorp shareholder who holds Boardwalk Bancorp common stock as a capital asset and who receives in the merger, in exchange for such stock, cash in lieu of a fractional share interest in Cape Bancorp common stock will be treated as having received such cash in full payment for such fractional share of stock and as capital gain or loss, notwithstanding the dividend rules discussed above.

Tax Treatment of Options . The excess of the cash consideration of $23.00 per share to be paid by Cape Bancorp for each share of Boardwalk Bancorp common stock over the per share exercise price for each share of common stock subject to such stock options will constitute taxable ordinary income to the option holder.

Backup Withholding. Unless an exemption applies under the backup withholding rules of Section 3406 of the Internal Revenue Code, the exchange agent will be required to withhold, and will withhold, 28% of any cash payments to which a Boardwalk Bancorp shareholder is entitled pursuant to the merger, unless the Boardwalk Bancorp stockholder provides the appropriate form. A Boardwalk Bancorp shareholder should complete and sign the substitute Internal Revenue Service Form W-9 enclosed with the letter of transmittal sent by the exchange agent. Unless an applicable exemption exists and is proved in a manner satisfactory to the exchange agent, this completed form provides the information, including the Boardwalk Bancorp shareholder’s taxpayer identification number, and certification necessary to avoid backup withholding. Any amount withheld as backup withholding from payments to an exchanging Boardwalk Bancorp shareholder will be allowed by the Internal Revenue Service as a refund or credit against the Boardwalk Bancorp shareholder’s federal income tax liability if the shareholder timely furnishes the required information to the Internal Revenue Service.

The foregoing is a summary discussion of material federal income tax consequences of the merger. The discussion is included for general information purposes only and may not apply to a particular Boardwalk Bancorp shareholder in light of such shareholder’s particular circumstances. Boardwalk Bancorp shareholders should consult their own tax advisors as to the particular tax consequences to them of the merger, including the application of state, local and foreign tax laws and possible future changes in federal income tax laws and the interpretation thereof, which can have retroactive effects.

Interests of Certain Persons in the Merger

As described below, certain of Boardwalk Bancorp’s officers and directors have interests in the merger that are in addition to, or different from, the interests of Boardwalk Bancorp’s shareholders generally. Boardwalk Bancorp’s board of directors was aware of these conflicts of interest and took them into account in approving the merger.

Existing Boardwalk Employment Agreement and Change in Control Agreements. Michael D. Devlin, Chairman, President and Chief Executive Officer of Boardwalk Bancorp and Boardwalk Bank, is a party to an

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employment agreement with Boardwalk Bank. Wayne S. Hardenbrook, Executive Vice President and Chief Financial Officer of Boardwalk Bancorp and Boardwalk Bank, Guy A. Deninger, Executive Vice President and Chief Lending Officer of Boardwalk Bancorp and Boardwalk Bank, and five additional officers of Boardwalk Bank are each parties to change in control agreements with Boardwalk Bank.

Under Mr. Devlin’s employment agreement, he is entitled to receive a lump-sum cash payment upon the occurrence of a “change in control,” which is defined to mean a change in ownership of Boardwalk Bancorp or Boardwalk Bank, a change in effective control of Boardwalk Bancorp or Boardwalk Bank, or a change in the ownership of a substantial portion of the assets of Boardwalk Bancorp or Boardwalk Bank. In such event, Mr. Devlin’s employment agreement provides that he is entitled to receive a lump-sum cash payment equal to three times the sum of (i) the highest annualized base salary paid to him during the year of payment or the preceding two calendar years and (ii) the highest bonus paid to him with respect to one of the three calendar years immediately preceding the year of payment. The employment agreement also provides for a payment equal to 90% of base salary in lieu of continued welfare and other benefits. The merger with Cape Bancorp will constitute a “change in control” within the meaning of Mr. Devlin’s employment agreement. Mr. Devlin has agreed to reduce the payment amount due to him as a result of the merger with Cape Bancorp, to the extent necessary, to an amount that, when aggregated with any other payments that are contingent on the occurrence of the merger transaction, will not cause an excess parachute payment under Section 280G of the Internal Revenue Code. Parachute payments generally are payments that, in the aggregate, exceed three times the recipient’s average annual compensation includable in the recipient’s gross income during the most recent five taxable years ending before the year in which the control of the employer occurs (the “base amount”). Recipients of parachute payments are subject to a 20% excise tax on the amount by which such payments exceed the base amount (an “excess parachute payment”), in addition to regular income taxes, and excess parachute payments are not deductible by the employer as compensation expense for federal income tax purposes. Accordingly, Mr. Devlin will receive, on the later of the closing date of the merger transaction with Cape Bancorp or the first business day of January 2008, a cash payment in the amount of approximately $645,000.

The change in control agreements for Messrs. Hardenbrook and Deninger each provide for a lump-sum cash payment upon the occurrence of a “change in control,” which is defined the same as for purposes of Mr. Devlin’s employment agreement and would include the merger transaction with Cape Bancorp. Under their change in control agreements, each of Mr. Hardenbrook and Mr. Deninger would be entitled to lump-sum cash payments equal to two times the sum of (i) the highest annualized base salary paid to him during the year of payment or the preceding three calendar years and (ii) the highest bonus paid to him with respect to the year of payment or the immediately preceding three calendar years. The change in control agreements also provide for continued health and medical benefits for a period of two years, or reimbursement of the after-tax cost of obtaining substantially similar benefits. Both Mr. Hardenbrook and Mr. Deninger have agreed to reduce the payment amount due to him as a result of the merger with Cape Bancorp, to the extent necessary, to an amount that, when aggregated with any other payments that are contingent on the occurrence of the transaction, will not cause an excess parachute payment under Section 280G of the Internal Revenue Code. Accordingly, Mr. Hardenbrook and Mr. Deninger will receive, on the later of the closing date of the merger transaction with Cape Bancorp or the first business day of January 2008, a cash payment in the amount of approximately $493,000 and $383,000, respectively.

Five other non-executive officers of Boardwalk Bancorp are parties to change in control agreements with Boardwalk Bank, which are substantially similar to the change in control agreements for Messrs. Hardenbrook and Deninger, but which provide for lump-sum cash payments equal to the sum of highest annualized base salary and highest bonus for the applicable periods. Each of these officers has agreed to forego any payments under their change in control agreements with Boardwalk Bank and, in lieu thereof, has executed a new one-year change in control agreement with Cape Savings Bank, which supersedes the officer’s existing change in control agreement with Boardwalk Bank. Each officer has also agreed to a retention bonus from Cape Savings Bank if the officer remains employed by Cape Savings Bank on the first and second anniversary dates of the merger transaction. Seventy-five percent of the total retention bonus for each officer will be paid on the first anniversary date of the merger and twenty-five percent of the total retention bonus will be paid on the second anniversary date of the merger. If the officer’s employment is terminated involuntarily prior to the first anniversary date of the merger, the officer will generally receive the total amount to which the officer would have been entitled under the Boardwalk Bank change in control agreements. The total retention bonuses are generally in the total amount of one year’s base salary for the applicable

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officer. Each officer will also be entitled to continued health and medical benefits, at no charge, for a period of one year following termination of employment with Cape Savings Bank.

New Employment and Change in Control Agreements with Cape Savings Bank. Michael D. Devlin and Guy A. Deninger have each entered into new employment agreements with Cape Savings Bank, effective as of the effective date of the merger between Boardwalk Bancorp and Cape Bancorp. Wayne S. Hardenbrook has entered into a new change in control agreement with Cape Savings Bank, effective as of the effective date of the merger between Boardwalk Bancorp and Cape Bancorp. For a description of these agreements, see “Executive Compensation – Employment Agreements” and “Executive Compensation – Change in Control Agreements.” As indicated above, five other non-executive officers of Boardwalk Bancorp have also executed new one-year change in control agreements with Cape Savings Bank.

Equity Compensation Awards. The merger agreement provides that each option to purchase shares of Boardwalk Bancorp common stock that is issued and outstanding immediately prior to the completion of the transaction, including all options held by Boardwalk officers and directors, will be canceled in exchange for a cash payment, less required holding taxes, equal to the excess, if any, of $23.00 over the exercise price per share of common stock subject to the option for each share subject to option. With respect to each of Messrs. Devlin, Hardenbrook and Deninger, in the event that all depositor and shareholder votes required for completion of the merger have occurred, Boardwalk has agreed to take all actions necessary to cause each outstanding option held by these executive officers to be fully vested, if not previously vested, prior to December 31, 2007, and canceled in exchange for a cash payment, less required holding taxes, equal to the excess, if any, of $23.00 over the exercise price per share of common stock subject to the option for each share subject to option.

Appointment of Directors to the Cape Bancorp Board of Directors . Cape Bancorp will appoint three members of Boardwalk Bancorp’s directors to the boards of directors of Cape Bancorp and Cape Savings Bank. Those individuals will be Thomas K. Ritter, Michael D. Devlin and Agostino R. Fabietti. If any of these Boardwalk Bancorp director designees shall be unable or unwilling to serve as a nominee or a director for any reason either prior to his appointment as a director or during his term of office, then the remaining Boardwalk Bancorp director designees shall designate another person acceptable to a majority of the members of the respective Boards to replace such individual. Mr. Ritter shall serve as a director in the class of directors whose term expires in 2010, Mr. Devlin shall serve as a director in the class of directors whose term expires in 2009 and Mr. Fabietti shall serve as a director in the class of directors whose term expires in 2008. Subject to their fiduciary duties, the boards of Cape Bancorp and Cape Savings Bank shall take all action necessary to appoint each of Messrs. Fabietti and Devlin to their respective board for a three-year term following the expiration of their terms listed above.

Employee Severance . Except in the circumstances described below, an employee of Boardwalk Bancorp or Boardwalk Bank who continues as an employee of Cape Savings Bank or any of its subsidiaries but is involuntarily terminated, other than for cause (as defined in the preceding section), within twelve months of the effective time of the merger, will receive a lump sum payment equal to two weeks base pay (as defined below) for each full year of service at Boardwalk Bancorp or Boardwalk Bank with a minimum payment equal to four weeks of base pay and a maximum payment amount equal to 16 weeks of base pay. Any employee of Boardwalk Bancorp or Boardwalk Bank who has a separate employment agreement, change in control agreement or severance agreement is entitled only to the payments provided by such agreement.

With respect to the severance benefits described above, “base pay” means the employee’s salary rate on effect on the termination date.

Continued Director and Officer Liability Coverage . For a period of six years following the effective time of the merger, Cape Bancorp has agreed to indemnify, and advance expenses in matters that may be subject to indemnification to, persons who served as directors or officers of Boardwalk Bancorp, Boardwalk Bank or any of their subsidiaries with respect to liabilities and claims (and related expenses, including fees and disbursements of counsel) made against them resulting from their service as such prior to the effective time of the merger to the same extent as Boardwalk Bancorp currently provides for indemnification of its officers and directors. Cape Bancorp has also agreed to purchase and keep in force for a period of six years following the effective time of the merger directors’ and officers’ liability insurance to provide coverage for acts or omissions of the type and in the amount currently covered by

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Boardwalk Bancorp’s and Boardwalk Bank’s existing directors’ and officers’ liability insurance for acts or omissions occurring on or prior to the effective time of the merger. However, Cape Bancorp is not required to expend in the aggregate an amount greater than 250% of the annual cost currently expended by Boardwalk Bancorp and Boardwalk Bank with respect to such insurance (the “Insurance Amount”). If the cost of procuring such insurance would exceed the Insurance Amount, Cape Bancorp shall use its reasonable best efforts to obtain as much comparable insurance as is available for the Insurance Amount.

Employee Matters

Cost efficiencies are being identified by management of Cape Bancorp and as decisions are made regarding the integration of Boardwalk Bank into Cape Savings Bank and the possible consolidation of certain Boardwalk Bank branch offices, if any, decisions will also be made regarding certain Boardwalk Bancorp and Boardwalk Bank management and employee positions that may be eliminated. Each person who is an employee of Boardwalk Bank as of the closing of the merger (whose employment is not specifically terminated upon the closing) will become an employee of Cape Savings Bank. Cape Bancorp or its subsidiaries will make available employer-provided health and other employee welfare benefit plans to each continuing employee on the same basis that such employees received coverage from Boardwalk Bank until Cape Savings Bank alters such benefits to make them consistent with the benefits being offered by Cape Savings Bank. Former employees of Boardwalk Bank who become employees of Cape Savings Bank in connection with the merger will generally be eligible to participate in the Cape Savings Bank’s 401(k) Plan and the Cape Savings Bank employee stock ownership plan in accordance with the eligibility provisions of the respective plans. Former employees of Boardwalk Bank shall be considered new employees for purposes of eligibility and vesting in Cape Savings Bank’s defined benefit pension plan and the employee stock ownership plan.

Regulatory Approvals Needed to Complete the Merger, the Reorganization and the Offering

General . The merger cannot proceed in the absence of the requisite regulatory approvals. See “The Acquisition of Boardwalk Bancorp—Conditions to Completion of the Merger” and “—Termination.” There can be no assurance that the requisite regulatory approvals will be obtained, and if obtained, there can be no assurance as to the date of any approval. There can also be no assurance that any regulatory approvals will not contain a condition or requirement that causes the approvals to fail to satisfy the condition set forth in the merger agreement and described under “The Acquisition of Boardwalk Bancorp—Conditions to Completing the Merger.”

The approval of an application merely implies the satisfaction of regulatory criteria for approval, which does not include review of the merger from the standpoint of the adequacy of the cash consideration or the exchange ratio for converting Boardwalk Bancorp common stock to Cape Bancorp common stock. Furthermore, regulatory approvals do not constitute an endorsement or recommendation of the merger.

Merger Approvals . Completion of the merger is subject to prior approval of the Federal Deposit Insurance Corporation and the New Jersey Department of Banking and Insurance. In reviewing applications for transactions of this type, the Federal Deposit Insurance Corporation must consider, among other factors, the financial and managerial resources and future prospects of the existing and resulting institutions, the convenience and needs of the communities to be served, and competitive factors. Similarly, the New Jersey Department of Banking and Insurance must consider, among other factors, whether the merger will be consistent with adequate and sound banking practices and in the public interest on the basis of the following:

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In addition, the Federal Deposit Insurance Corporation may not approve a transaction if it will result in a monopoly or otherwise be anticompetitive. Cape Bancorp filed applications with the Federal Deposit Insurance Corporation and the New Jersey Department of Banking and Insurance on September 21, 2007 and received conditional approval from the Federal Deposit Insurance Corporation and conditional approval from the New Jersey Department of Banking and Insurance to complete the merger.

Under the Community Reinvestment Act of 1977, the Federal Deposit Insurance Corporation must take into account the record of performance of Boardwalk Bank and Cape Savings Bank in meeting the credit needs of the entire community, including low- and moderate-income neighborhoods, served by each institution. As part of the review process, bank regulatory agencies frequently receive comments and protests from community groups and others. Boardwalk Bank received a “Satisfactory” rating during its last Community Reinvestment Act examination by the Federal Deposit Insurance Corporation and Cape Savings Bank received a “Satisfactory” rating during its last Community Reinvestment Act examination conducted by the Federal Deposit Insurance Corporation.

In addition, a period of 15 to 30 days must expire following approval by the Federal Deposit Insurance Corporation before completion of the merger of Cape Savings Bank and Boardwalk Bank is allowed, within which period the United States Department of Justice may file objections to the merger under the federal antitrust laws. While Boardwalk Bancorp and Cape Bancorp believe that the likelihood of objection by the Department of Justice is remote in this case, there can be no assurance that the Department of Justice will not initiate proceedings to block the merger of the two banks, or that the Attorney General of the State of New Jersey will not challenge the merger of the two banks, or if any proceeding is instituted or challenge is made, as to the result of the challenge.

Offering Approvals . Cape Savings Bank has adopted a plan of conversion pursuant to which it is converting from the mutual-to-stock form of organization and Cape Bancorp is offering shares of its common stock to Cape Savings Bank’s eligible depositors, the public and shareholders of Boardwalk Bancorp. Consummation of the merger is subject to certain conditions, including the receipt by Cape Bancorp of all approvals necessary to complete its conversion and stock offering. The Federal Deposit Insurance Corporation has issued a letter of conditional non-objection to the conversion and stock offering. The New Jersey Department of Banking and Insurance has conditionally approved the conversion and stock offering. The Office of Thrift Supervision must approve Cape Bancorp, Inc. as the savings and loan holding company of Cape Savings Bank. Cape Bancorp’s holding company application remains pending before the Office of Thrift Supervision. Cape Bancorp also filed a Registration Statement on Form S-1 with the Securities and Exchange Commission, which was declared effective on November 13, 2007.

Accounting Treatment of the Merger

Cape Bancorp will use the purchase method of accounting for the merger. Under this method of accounting, the assets and liabilities of Boardwalk Bancorp will be recorded on Cape Bancorp’s consolidated balance sheet at their estimated fair values at the effective date of the merger. The amount by which the purchase price exceeds the fair value of the net tangible and identifiable intangible assets acquired by Cape Bancorp through the merger will be recorded as goodwill. Goodwill will not be amortized, but will instead be subject to assessment for impairment, and identifiable intangible assets will be amortized over their estimated useful lives. Cape Bancorp currently expects that, based on preliminary accounting estimates, the merger would result in the recording of goodwill of approximately $50.6 million and a core deposit intangible of approximately $5.1 million.

Resale of Cape Bancorp Common Stock

The shares of Cape Bancorp common stock to be issued to shareholders of Boardwalk Bancorp in the merger have been registered under the Securities Act of 1933. Shares of Cape Bancorp common stock issued in the merger may be traded freely and without restriction by those shareholders not deemed to be “affiliates” of Boardwalk Bancorp, as that term is defined in the rules under the Securities Act of 1933. Cape Bancorp common stock received by those shareholders of Boardwalk Bancorp who are deemed to be “affiliates” of Boardwalk Bancorp at the time the merger is submitted for vote of the shareholders of Boardwalk Bancorp may be resold without registration under the Securities Act of 1933 only to the extent provided for by Rule 145 promulgated under the Securities Act of 1933. Rule 145 permits limited sales under certain circumstances, or pursuant to another exemption from registration. An affiliate of

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Boardwalk Bancorp is an individual or entity that controls, is controlled by, or is under common control with, Boardwalk Bancorp, as the case may be, and may include the executive officers and directors of Boardwalk Bancorp, as well as certain principal shareholders of Boardwalk Bancorp. The same restrictions apply to certain relatives or the spouses of those persons and any trusts, estates, corporations or other entities in which those persons have a 10% or greater beneficial interest.

Pursuant to the terms of the merger agreement, Boardwalk Bancorp has caused each person who may be deemed an affiliate of Boardwalk Bancorp for purposes of Rule 145 under the Securities Act of 1933 to deliver to Cape Savings Bank a written agreement intended to ensure compliance with the Securities Act of 1933.

The Merger Agreement

The following describes material provisions of the merger agreement. This description does not purport to be complete and is qualified by reference to the merger agreement, which is attached as Appendix A and is incorporated by reference into this proxy statement-prospectus.

Time of Completion

The closing of the merger will take place no later than the 5th business day after the last condition precedent pursuant to the merger agreement has been fulfilled or waived (including the expiration of any applicable waiting period), or at such other place, date or time upon which Cape Savings Bank and Boardwalk Bancorp mutually agree. On the closing date, Boardwalk Bancorp will merge with and into Cape Bancorp. Cape Bancorp will file a certificate of merger with the New Jersey Office of the Secretary of State in accordance with the New Jersey Business Corporation Act, and will file articles of merger with the Maryland Department of Assessments and Taxation merging Boardwalk Bancorp into Cape Bancorp. The merger will become effective at the time stated in such certificate of merger and articles of merger.

It is expected that the merger will be completed during the first calendar quarter of 2008. However, because completion of the merger is subject to regulatory approvals and other conditions, the parties cannot be certain of the actual timing. Furthermore, either company may terminate the merger agreement if, among other reasons, the merger has not been completed on or before June 30, 2008, unless failure to complete the merger by that time is due to a failure to fulfill any material obligation under the merger agreement by the party seeking to terminate the agreement. See “—Termination, Amendment and Waiver.”

Possible Alternative Structures

Cape Bancorp is entitled to revise the structure of the merger, provided that:

Cape Bancorp is not entitled to revise the structure of the merger to provide for a mutual holding company structure without the prior written consent of Boardwalk Bancorp, which consent may be withheld in its sole discretion.

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Representations and Warranties

The merger agreement contains various representations and warranties by Cape Bancorp and Cape Savings Bank and Boardwalk Bancorp and Boardwalk Bank that are customary for a transaction of this kind. Some of the representations and warranties are qualified by materiality and other exceptions. They include, among other things:

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All representations, warranties and covenants of the parties, other than the covenants in specified sections that relate to continuing matters, terminate upon the merger.

Covenants of the Parties

Conduct of Business Pending the Merger . In the merger agreement, Boardwalk Bancorp has agreed, pending consummation of the merger, that it will, among other things, unless otherwise consented to in writing by Cape Savings Bank (which consent will not be unreasonably withheld, conditioned or delayed):

Negative Covenants of Boardwalk Bancorp . Boardwalk Bancorp has agreed that from the date of the merger agreement until the completion of the merger, except as otherwise specifically permitted or required by the merger agreement, or consented to by Cape Savings Bank in writing (which consent shall not be unreasonably withheld, conditioned or delayed), Boardwalk Bancorp; Boardwalk Bank and their subsidiaries, will not and will not agree to do certain things. The merger agreement describes these commitments in detail, and sets forth exceptions to the commitments. In the merger agreement, Boardwalk Bancorp has agreed that neither it nor its subsidiaries will do the following:

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Current Information . Each company has agreed to keep the other informed of the general status of its ongoing operations. Each company has agreed to promptly notify the other of any material change in its business.

Access to Properties and Records . Subject to other terms of the merger agreement, Boardwalk Bancorp and Boardwalk Bank have agreed to permit Cape Bancorp reasonable access to their properties, and to disclose and make available their books, papers and records relating to their operations.

Financial and Other Statements . Boardwalk Bancorp has agreed to furnish to Cape Savings Bank copies of audited financial statements and copies of all internal control reports submitted to Boardwalk Bancorp by its independent accountants. Boardwalk Bancorp has agreed to deliver to Cape Savings Bank copies of all filings made with the Securities and Exchange Commission, and all reports that are filed with bank regulators. Boardwalk Bancorp will advise Cape Savings Bank of the receipt of examination reports from any bank regulator, and will furnish to Cape Bancorp any additional financial data as Cape Bancorp may reasonably request.

Consents and Approvals of Third Parties; All Reasonable Efforts . Boardwalk Bancorp and Cape Savings Bank have agreed to use all commercially reasonable efforts to obtain all consents and approvals necessary for the consummation of the merger. Subject to the terms of the merger agreement, Boardwalk Bancorp and Cape Savings Bank have agreed to use all commercially reasonable efforts to take all action necessary or advisable to consummate the merger. Cape Savings Bank, at its discretion, may require Boardwalk Bancorp to engage a professional proxy solicitor to obtain the requisite shareholder vote on the merger.

Failure to Fulfill Conditions . Boardwalk Bancorp and Cape Bancorp have agreed to promptly notify the other in the event that they determine that a condition to their obligation to complete the merger cannot be fulfilled and that they will not waive the condition.

No Solicitation . Boardwalk Bancorp has agreed that, unless the merger agreement has been terminated, neither it, its subsidiaries, its officers, directors, employees, representatives, agents or affiliates will:

Boardwalk Bancorp is required to notify Cape Savings of all of the relevant details relating to all inquiries and proposals which it may receive relating to proposals to acquire Boardwalk Bancorp or Boardwalk Bank. The merger agreement provides that the Board of Directors of Boardwalk Bancorp or Boardwalk Bank may furnish information to, or enter into discussions or negotiations relating to unsolicited written proposals to acquire Boardwalk Bancorp, so long as such actions are required by the fiduciary duties of the board of directors to consider a financially superior proposal.

Reserves and Merger-Related Costs . On or before the closing of the merger, to the extent consistent with U.S. Generally Accepted Accounting Principles, the rules, regulations and interpretations of the Securities and Exchange Commission and applicable banking laws and regulations, Boardwalk Bancorp shall establish such additional accruals and reserves as may be necessary to conform the accounting reserve practices and methods (including credit loss practices and methods) of Boardwalk Bancorp to those of Cape Savings Bank and Cape Savings Bank’s plans with respect to the conduct of the business of Boardwalk Bancorp following the merger. Boardwalk Bancorp shall not be required to take such action unless Cape Savings Bank agrees in writing that all conditions to closing the merger have been satisfied or waived (except for the expiration of any applicable waiting periods) and that it is not aware of any fact or circumstance that would prevent completion of the merger.

Board of Directors and Committee Meetings . Boardwalk Bancorp and Boardwalk Bank have agreed that they will permit one representative of Cape Savings Bank to attend any meeting of their boards of directors or executive and audit committees. The representative will not remain present during any discussion of the merger agreement or any other matter where access or disclosure would violate or prejudice the rights of third-parties, would result in the waiver by Boardwalk Bancorp and Boardwalk Bank of attorney-client privilege or would violate a confidentiality obligation or fiduciary duty.

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Prohibition on Solicitation of Employees . If the merger is not consummated, Boardwalk Bancorp and Cape Savings Bank have each agreed not to solicit for employment any employee of the other designated a loan officer or a Vice President or higher, for a period of two years from the date the merger is terminated.

Employee Benefits . Pursuant to the merger agreement, Cape Bancorp entered into employment agreements, effective at the effective time of the merger, with Messrs. Devlin and Deninger, and entered into change in control agreements, effective at the effective time of the merger, with Mr. Hardenbrook and five other executive officers of Boardwalk Bancorp. See “The Merger—Interests of Certain Persons in Merger.”

Conditions to Completing the Merger

Cape Bancorp’s and Boardwalk Bancorp’s obligations to consummate the merger are conditioned on the following:

Conditions to the Obligations of Each Party Under the Merger Agreement . The respective obligations of Cape Bancorp, Cape Savings Bank, Boardwalk Bancorp and Boardwalk Bank are subject to various conditions prior to the merger, which conditions cannot be waived. The conditions include the following:

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Additional Conditions to the Obligations Under the Merger Agreement . The obligations of Cape Savings Bank and Boardwalk Bancorp are further subject to various conditions, including the following:

The parties may waive conditions to their obligations unless they are legally prohibited from doing so. Cape Bancorp and Boardwalk Bancorp cannot guarantee whether all of the conditions to the merger will be satisfied or waived by the party permitted to do so.

Termination, Amendment and Waiver

Termination . The merger agreement may be terminated at any time prior to the completion of the merger under the following circumstances:

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Effect of Termination . The merger agreement describes the expenses and damages that will be payable in the event the merger agreement is terminated. These terms provide that in certain circumstances termination will be without liability, cost or expense on the part of either party. If the termination results from a willful breach of certain provisions, the breaching party will be liable for any and all damages, costs and expenses sustained or incurred by the non-breaching party.

The merger agreement provides that Boardwalk Bancorp may be obligated to pay Cape Savings Bank a termination fee of $5.0 million if the merger agreement is terminated in certain circumstances. Specifically, Boardwalk Bancorp would be obligated to pay Cape Savings Bank a $5.0 million termination fee if:

Amendment, Extension and Waiver . By action of their respective boards of directors, the parties to the merger agreement may:

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Any amendment to the merger agreement must be in writing.

Management and Operations Following the Merger

Board of Directors . Three individuals currently serving on the board of directors of Boardwalk Bancorp, Michael D. Devlin, Agostino R. Fabietti and Thomas K. Ritter, will become directors of Cape Bancorp and Cape Savings Bank following completion of the merger. Messrs. Devlin, Fabietti and Ritter have indicated their intention to accept these positions.

Management. The current management team of Cape Savings Bank will remain in place as a result of the merger.

Voting Agreements

As a condition to Cape Savings Bank entering into the merger agreement, each of the directors and executive officers of Boardwalk Bancorp were required to enter into voting agreements in which they agreed to vote all of their shares in favor of the merger agreement. A total of 685,832 shares or 16.0% of the outstanding shares of Boardwalk Bancorp common stock are subject to these voting agreements.

Compensation of Directors

The following table provides information concerning the compensation paid to or earned by Michael D. Devlin, Agostino R. Fabietti and Thomas K. Ritter in their capacities as members of Boardwalk Bancorp’s and Boardwalk Bank’s Boards of Directors for Boardwalk Bancorp’s last fiscal year:

Director Compensation for Fiscal Year 2006

Director fees are $600 for each board meeting attended and $200 for each committee meeting attended, except the Boardwalk Bancorp’s Audit Committee which is $400. Mr. Devlin does not receive fees for his attendance at board or committee meetings.

Directors Benevento, Glenn, Nugent, Harris, Koelling and Ritter participate in a director deferred compensation fee plan, which permits directors to defer up to 100% of their fees pursuant to a prior election. Boardwalk Bank has established a deferral account for participating directors and credits the account with fees payable for attendance at board meetings which are deferred in accordance with the director’s prior election. Interest on the deferred amounts is credited at the prime rate as published in The Wall Street Journal . Interest is credited at such rate on a monthly basis, compounded daily. Directors are 100% vested in their account balances which are payable generally upon their termination of service on the board of directors of Boardwalk Bank. Directors can receive payment of their deferred account balance in a lump-sum or in equal installments over a ten-year period following termination of service.

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