THIS RETIREMENT AGREEMENT (this "Agreement") is signed on December 10, 2004 by and among DNB
FINANCIAL CORPORATION ("Corporation"), a Pennsylvania business corporation and bank holding
company; DNB FIRST, NATIONAL ASSOCIATION ("Bank"), a national banking association and wholly-
owned subsidiary of the Corporation (as used in this Agreement, the term "Company" shall refer both individually
and collectively to the Corporation and the Bank); and HENRY F. THORNE, an adult individual and resident of
Delaware County, Pennsylvania ("Executive"). This Agreement is intended to be effective immediately after 5:00
p.m. prevailing Eastern time on December 17, 2004 (the "Effective Date") in accordance with
Section 17 of this Agreement.
A. Executive and Company are parties to that certain Employment Agreement dated December 31, 1996 (the
"1996 Employment Agreement").
B. The 1996 Employment Agreement has been amended once, pursuant to a certain First Amendment to
Employment Agreement dated as of December 23, 2003 (the "Employment Agreement Amendment"). The 1996
Employment Agreement, as amended by the Employment Agreement Amendment is sometimes referred to in this
Agreement as the "Executive Employment Agreement."
C. Executive and Company are parties to a certain Retirement and Death Benefit Agreement dates as of
December 23, 2003, providing for certain death benefits, retirement benefits and other benefits for Executive and
his beneficiaries (the "SERP").
D. Executive holds existing options to purchase 14,889 shares of Corporation stock pursuant to stock options
heretofore granted to Executive from time to time (the "Existing Stock Options") pursuant to written agreements
between Executive and Company with respect thereto (the "Stock Option Agreements").
E. Executive and Company have agreed upon terms for Executive's retirement on the Effective Date from his
current positions with the Company, and a scheduled early retirement from his remaining emplo