Exhibit 10.20

YARDVILLE NATIONAL BANK
DIRECTORS’ DEFERRED FEE PLAN

ARTICLE I
PURPOSE

     The purpose of the Yardville National Bank Directors’ Deferred Fee Plan
(hereinafter referred to as the “Plan”) is to aid in retaining and attracting
Directors of exceptional ability. This Plan is the successor to the Yardville
National Bank Directors Deferred Compensation Plan originally adopted as of
January 1, 1995 (the “1995 Plan”).

ARTICLE II
DEFINITIONS

     For the purpose of this Plan, the following words and phrases shall have
the meanings indicated, unless the context clearly indicates otherwise:

     “Beneficiary” means the person, persons or entity designated by the
Participant, or as provided in Article VII, to receive any benefits payable
under the Plan.

     “Board” means the Board of Directors of Yardville National Bank.

     “Change in Control” means:

  (a)   At such time as any “person” (as the term in used in Section 13(d) and
14(d) of the Securities and Exchange Act of 1934, as amended (“Exchange Act”) is
or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of voting securities of the Company or the right
to acquire such securities, except for any voting securities purchase by any
employee benefit plan of the Company or its subsidiaries;     (b)   At such time
as individuals who constitute the Board of Directors of the Company on the date
hereof (the “Incumbent Board”) cease for any reason to constitute a least a
majority thereof; provided that any person becoming a director subsequent to the
date hereof whose election was approved by a vote of at least three-quarters of
the directors constituting the Incumbent Board (or members who were nominated by
the Incumbent Board), or whose nomination for election by the Company’s
stockholders was approved by a nominating committee solely composed of members
which are Incumbent Board members (or members nominated by the Incumbent Board),
shall be, for purposes of this clause, considered as though he or she were a
member of the Incumbent Board.     (c)   At such time as a reorganization,
merger, consolidation, or similar transaction occurs or is effectuated as a
result of which 60% of shares of common stock of the resulting entity are owned
by persons who were not stockholders of the Company immediately prior to the
consummation of the transaction; or

 

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  (d)   At such time as substantially all of the assets of the Company are sold
or otherwise transferred to another corporation or other entity that is not
controlled by the Company.

     “Committee” means a Committee of the Board.

     “Company” means Yardville National Bancorp, Inc., a New Jersey corporation,
or any successor thereto.

     “Declared Rate” means, with respect to any Plan Year, two (2) percentage
points over the prime rate as published in the Wall Street Journal. The Board
shall establish the Declared Rate effective as of the first business day of each
Plan Year. Such Declared Rate, once established, shall be used for all interest
determinations during such Plan Year.

     “Deferral Benefit” means the benefit payable to a Participant or his
Beneficiary upon his termination of service as a Director or as otherwise
provided in his Participation Agreement, or upon approval of a Director’s
request for a Hardship Withdrawal.

     “Deferred Benefit Account” means the account maintained on the books of the
Company for each Participant pursuant to Article V. A Participant’s Deferred
Benefit Account shall be utilized solely as a device for the measurement and
determination of the amounts to be paid to the Participant pursuant to this
Plan. A Participant’s Deferred Benefit Account shall not constitute or be
treated as a trust fund of any kind.

     “Designation of Form for Payment” means the agreement filed by a
Participant designating the manner in which the Participant’s Deferred Benefit
Account balance shall be paid to the Participant or his beneficiary.

     “Determination Date” means the date on which the amount of a Participant’s
Deferred Benefit Account is determined as provided in Article V hereof. The last
day of each Plan Year shall be the Determination Date.

     “Director” means a non-employee member of the Board of Directors of the
Bank.

     “Fee” or “Fees” means any cash compensation paid to a Director for his
services as a Director, including retainers and fees for attendance at meetings
of the Board or Board Committees (or, if applicable, cash compensation received
for service as a director of the Company or as a director of any subsidiary of
the Bank or the Company).

     “Hardship Distribution” means a distribution pursuant to a Director’s
request made under Section 6.3 of the Plan.

     “Participant” means any eligible Director who elects to participate by
filing a Participation Agreement as provided in Article III.

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     “Participation Agreement” means the agreement filed by a Participant prior
to the beginning of the first period for which the Participant’s Fees are to be
deferred pursuant to the Plan and the Participation Agreement. A new
Participation Agreement may be filed by the Participant on an annual basis for
each separate Fee deferral election or an initial election may continue until
modified in accordance with the Plan.

     “Plan Year” means a twelve month period commencing January 1st and ending
the following December 31st. The first Plan Year shall commence on the date of
adoption of this Plan by the Board and end on December 31, 2004.

ARTICLE III
ELIGIBILITY AND PARTICIPATION

     3.1 ELIGIBILITY. Eligibility to participate in the Plan is limited to
Directors.

     3.2 PARTICIPATION. Participation in the Plan shall be limited to Directors
of the Bank who elect to participate in the Plan by filing a Participation
Agreement with the Bank. In addition, a Participant who is also a Director of
the Company or any subsidiary of the Bank or the Company may also elect to defer
all Fees received from such entity under this Plan. A Participation Agreement
must be filed prior to the December 15th immediately preceding the Plan Year in
which the Participant’s participation under the agreement will commence, and the
election to participate shall be effective on the first day of the Plan Year
following receipt by the Bank of a properly completed and executed Participation
Agreement. In the event that an individual first becomes eligible to participate
during the course of a Plan Year or, with respect to participation during the
first Plan Year, a Participation Agreement must be filed no later than 30 days
following notification of the individual by the Committee of eligibility to
participate and such Participation Agreement shall be effective only with regard
to Fees earned or payable following the filing of the Participation Agreement
with the Committee.

     3.3 AMOUNT OF DEFERRAL. A Participant may elect in any Participation
Agreement to defer up to 100% of his Fees otherwise payable in cash during the
Plan Year in increments of 5%. A Participant’s election to defer his Fees shall
be irrevocable for the applicable Plan Year upon the filing of the respective
Participation Agreement; provided, however, that the deferral of Fees under any
Participation Agreement may be suspended or amended as provided in Sections 10.1
or 10.2.

ARTICLE IV
DEFERRED FEES

     4.1 ELECTIVE DEFERRALS. The amount of Fees that a Participant elects to
defer under this Plan shall be credited by the Bank to the Participant’s
Deferred Benefit Account as the Participant’s Fees are payable. The amount
credited to a Participant’s Deferred Benefit Account shall equal the amount
deferred.

     4.2 NON-ELECTIVE CONTRIBUTIONS. The Board may, in its sole discretion,
credit an additional non-elective contribution to a Participant’s Deferred
Benefit Account in any

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Plan Year in an amount determined as a percentage of the Participant’s deferral
(i.e., a matching contribution) or otherwise.

     4.3 VESTING OF DEFERRED BENEFIT ACCOUNT. A Participant shall be 100% vested
in his Deferred Benefit Account at all times.

     4.4 DESIGNATION OF FORM OF PAYMENT. Subject to Section 6.4(c) and Article
XII, a Participant shall file a Designation of Form of Payment with the Bank
when the Participant submits his Participation Agreement. Such Designation of
Form of Payment shall apply to all amounts credited to the Participant’s
Deferred Benefit Account unless superceded by a new Designation of Form of
Payment filed in accordance with Section 6.4(c).

ARTICLE V
DEFERRED BENEFIT ACCOUNT

     5.1 DETERMINATION OF ACCOUNT. Subject to Article XII each Participant’s
Deferred Benefit Account as of each Determination Date shall consist of the
balance of the Participant’s Deferred Benefit Account as of the immediately
preceding Determination Date plus the Participant’s elective deferred Fees
withheld since the immediately preceding Determination Date pursuant to the
Section 4.1 and any non-elective contributions pursuant to Section 4.2. The
Deferred Benefit Account of each Participant shall be reduced by the amount of
all distributions, if any, made from such Deferred Benefit Account since the
preceding Determination Date.

     5.2 CREDITING OF ACCOUNT. As of each Determination Date, the Participant’s
Deferred Benefit Account shall be increased by the amount of interest earned
since the preceding Determination Date. Interest shall be based upon the
Declared Rate. Interest shall be based upon the average daily balance of the
Participant’s Deferred Benefit Account since the last preceding Determination
Date, but after the Deferred Benefit Account has been adjusted for any
contributions or distributions to be credited or deducted for each such day.

     5.3 STATEMENT OF ACCOUNTS. The Committee shall submit to each Participant,
within 120 days after the close of each Plan Year, a statement in such form as
the Committee deems desirable, setting forth the balance to the credit of such
Participant in his Deferred Benefit Account as of the last day of the preceding
Plan Year.

ARTICLE VI
BENEFITS

     6.1 TERMINATION OF SERVICE AS DIRECTOR. Upon any termination of service of
the Participant as a Director, the Bank shall pay to the Participant a Deferral
Benefit equal to the amount of his Deferred Benefit Account.

     6.2 IN-SERVICE WITHDRAWAL. Subject to making a timely in-service withdrawal
election in a Participation Agreement, a Participant may receive Deferral
Benefits while still in service with the Company. The election to receive an
in-service withdrawal must be made by notifying the Committee of such election
at least one (1) calendar year prior to the

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date that payment Deferral Benefits commence. The Company shall pay to the
Participant a Deferral Benefit equal to the amount of his Deferred Benefit
Account.

     6.3 HARDSHIP DISTRIBUTIONS. A Participant may file a request with the
Committee for the payment of a Hardship Distribution of all or any portion of
his Deferred Benefit Account at any time prior to the Participant’s termination
of service. The payment of a Hardship Distribution shall be based upon the
Committee’s determination, in its sole discretion, that the Participant has
experienced an unforeseeable financial emergency which is caused by an event
beyond the Participant’s control that would result in serious financial hardship
to the Participant. A Participant’s future deferrals under any Participation
Agreement then in effect shall be suspended as of the date of a Hardship
Distribution to the Participant.

     6.4 FORM OF BENEFIT PAYMENT.

    a)   Upon the occurrence of an event described in Section 6.1 or upon the
date specified by a Participant in an election under Section 6.2, the Bank shall
pay the Participant’s Deferred Benefit Account, at the Participant’s election,
in the form of (i) an annual payment of a fixed amount which shall amortize the
Participant’s Deferred Benefit Account balance as of the date of such event in
equal monthly payments of principal and interest over a period of not less than
two (2) years nor more than ten (10) years; or (ii) a lump sum. The
Participant’s election shall be made on his or her Designation of Form for
Payment. For purposes of determining the amount of the annual payment, the rate
of interest shall be the average of the Declared Rate credited to the
Participant’s Deferred Benefit Account for the three (3) completed Plan Years
preceding the initial payment (or the average of such lesser number of years in
which the Participant participated in the Plan).       b)   A Participant may,
while actively serving as a Director, change the form in which his benefits
shall be paid by filing a revised Designation of Form for Payment indicating
such change at least one (1) calendar year prior to the date payments are to
commence. Such Designation of Form for Payment shall be irrevocable beginning
one (1) calendar year prior to the date payments are to commence. Subject to
Section 6.4(c), no changes in the form of benefit payment shall be permitted
following a Participant’s termination of service as a Director.       c)  
Notwithstanding anything in this Plan to the contrary, a Participant whose
service as a Director terminates in connection with a Change in Control may
elect to receive a lump sum payment; provided, however that such election must
be made at least ninety (90) days prior to the effective date of the Change in
Control.

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     6.5 COMMENCEMENT OF PAYMENTS.

    a)   Commencement of installment payments due under Sections 6.1 of this
Plan shall begin within sixty (60) days following receipt of notice by the
Committee of an event which entitles a Participant (or a Beneficiary) to
payments under this Plan. A lump sum payment, if elected, shall be made within
ninety (90) days following a Participant’s termination of service.       b)   A
Participant may elect on his or her Designation of Form of Payment to defer the
commencement of benefit payments otherwise payable at the time specified in
Section 6.1(a) to a later date but in any event not beyond the first business
day of the January occurring after the year in which the Participant attains age
75. Such election must be made prior to a Participant’s termination of service
in accordance with Section 6.4(a) and (c).       c)   Commencement of payments
under Section 6.2 of this Plan shall begin upon the date requested by the
Participant.       d)   All installment payments made pursuant to this
Section 6.4 shall be payable annually beginning with a single payment on the
date specified in this Section 6.5 and continuing each anniversary of such date
until fully paid in accordance with the Participant’s election.

ARTICLE VII
BENEFICIARY DESIGNATION

     7.1 BENEFICIARY DESIGNATION. Each Participant shall have the right, at any
time, to designate any person or persons as his Beneficiary or Beneficiaries
(both principal as well as contingent) to wham payment under this Plan shall be
paid in the event of his death prior to complete distribution to Participant of
the benefits due him under the Plan. Any Participant Beneficiary Designation
shall be made in a written instrument filed with the Committee and shall be
effective only when received in writing by the Committee.

     7.2 AMENDMENTS. Any Beneficiary designation may be changed by a Participant
by the written filing of such change on a form prescribed by the Committee. The
filing of a new Beneficiary designation form will cancel all Beneficiary
designations previously filed.

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     7.3 NO PARTICIPANT DESIGNATION. If a Participant fails to designate a
Beneficiary as provided above, or if all designated Beneficiaries predecease the
Participant, then Participant’s designated Beneficiary shall be deemed to be the
person or persons surviving him in the first of the following classes in which
there is a survivor, share and share alike:

    a)   The surviving spouse;       b)   The Participant’s children, except
that if any of the children predecease the Participant but leave issue
surviving, then such issue shall take by right of representation the share their
parent would have taken if living;       c)   The Participant’s Estate.

     7.4 EFFECT OF PAYMENT. The payment to the deemed Beneficiary shall
completely discharge Bank’s obligations under this Plan.

ARTICLE VIII
ADMINISTRATION

     8.1 COMMITTEE; DUTIES. This Plan shall be administered by the Committee.
Members of the Committee may be Participants under this Plan but shall not
participate in deliberations or decisions which relate to their specific claim
for benefits under the Plan.

     8.2 AGENTS. The Committee may appoint an individual to be the Committee’s
agent with respect to the day-to-day administration of the Plan. In addition,
the Committee may, from time to time, employ other agents and delegate to them
such administrative duties as it sees fit, and may from time to time consult
with counsel who may be counsel to the Bank.

     8.3 BINDING EFFECT OF DECISIONS. The decision or action of the Committee
with respect to any question arising out of or in connection with the
administration, interpretation and application of the Plan and the rules and
regulations promulgated hereunder shall be final and binding upon all persons
having any interest in the Plan.

     8.4 INDEMNITY OF COMMITTEE. The Bank shall indemnify and hold harmless the
members of the Committee against any and all claims, loss, damage, expense or
liability arising from any action or failure to act with respect to this Plan,
except in the case of gross negligence or willful misconduct by the Committee.

ARTICLE IX
CLAIMS PROCEDURE

     9.1 CLAIM. Any person claiming a benefit, requesting an interpretation or
ruling under the Plan, or requesting information under the Plan shall present
the request in writing to the Committee which shall respond in writing as soon
as practicable.

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     9.2 DENIAL OF CLAIM. If the claim or request is denied, the written notice
of denial shall be made within ninety (90) days of the date of receipt of such
claim or requested by the Committee and shall state:

    a)   The reason for denial, with specific references to the Plan provisions
on which the denial is based.       b)   A description of any additional
material or information required and an explanation of why it is necessary.    
  c)   An explanation of the Plan’s claim review procedure.

     9.3 REVIEW OF CLAIM. Any person whose claim or request is denied or who has
not received a response within ninety (90) days may request review by notice
given in writing to the Committee within sixty (60) days of receiving a response
or one hundred fifty (150) days from the date the claim was received by the
Committee. The claim or request shall be reviewed by the Committee who may, but
shall not be required to, grant the claimant a hearing. On review, the claimant
may have representation, examine pertinent documents, and submit issues and
comments in writing.

     9.4 FINAL DECISION. The decision on review shall normally be made within
sixty (60) days after the Committee’s receipt of a request for review. If an
extension of time is required for a hearing or other special circumstances, the
claimant shall be notified and the time limit shall be one hundred twenty (120)
days after the Committee’s receipt of a request for review. The decision shall
be in writing and shall state the reasons and the relevant Plan provisions. All
decisions on review shall be final and bind all parties concerned.

ARTICLE X
AMENDMENT AND TERMINATION OF PLAN

     10.1 AMENDMENT. The Board may at any time amend the Plan in whole or in
part, provided, however, that no amendment shall be effective to decrease or
restrict any Deferred Benefit Account maintained pursuant to any existing
deferral under the Plan. Any change in the formula used to determine the
Declared Rate shall be prospective only and shall not become effective until the
first day of the calendar year which follows the adoption of the amendment.

     10.2 TERMINATION. The Board may at any time terminate the Plan if, in its
judgment, the tax, accounting, or other effects of the continuance of the Plan,
or potential payments thereunder would not be in the best interests of the Bank,
but such termination shall not affect the accrued benefits of Participants as of
the date of termination. Such deferrals shall otherwise remain subject to the
terms of this Plan.

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ARTICLE XI
MISCELLANEOUS

     11.1 UNSECURED GENERAL CREDITOR. Participants and their Beneficiaries,
heirs, successors and assigns shall have no secured interest or claim in any
property or assets of the Bank, nor shall they be beneficiaries of, or have any
rights, claims or interests in any life insurance policies, annuity contracts or
the proceeds therefrom owned or which may be acquired by the Bank (“Policies”).
Such Policies or other assets of the Bank shall not be held under any trust for
the benefit of Participants, their Beneficiaries, heirs, successors or assigns,
or held in any way as collateral security for the fulfilling of the obligations
of Bank under this Plan. Any and all of the Bank’s assets and Policies shall be,
and remain, the general, unpledged, unrestricted assets of the Bank. The Bank’s
obligation under the Plan shall be merely that of an unfunded and unsecured
promise of the Bank to pay money in the future.

     11.2 NON-ASSIGNABILITY. Neither a Participant nor any other person shall
have any right to commute, sell, assign, transfer, pledge, anticipate, mortgage
or otherwise encumber, transfer, hypothecate or convey in advance of actual
receipt the amounts, if any, payable hereunder, or any part thereof, which are,
and all rights to which are, expressly declared to be unassignable and
non-transferable. No part of the amounts payable shall, prior to actual payment,
be subject to seizure or sequestration for the payment of any debts, judgments,
alimony or separate maintenance owed by a Participant or any other person, nor
be transferable by operation of law in the event of a Participant’s or any other
person’s bankruptcy or insolvency.

     11.3 NOT A CONTRACT OF DIRECTORSHIP. The terms and conditions of this Plan
shall not be deemed to constitute a contract between the Bank and the
Participant relating to the Participant’s service as a Director, and the
Participant (or his Beneficiary) shall have no rights against the Bank except as
may otherwise be specifically provided herein. Moreover, nothing in this Plan
shall be deemed to give a Participant the right to be retained in the service of
the Bank or to interfere with the right of the Bank to discipline or discharge
him at any time.

     11.4 PARTICIPANT COOPERATION. A Participant will cooperate with the Bank by
furnishing any and all information requested by the Bank in order to facilitate
the payment of benefits under and by taking such physical examinations and such
other action as may be requested by the Bank.

     11.5 TERMS. Whenever any words are used herein in the masculine, they shall
be construed as though they were used in the feminine in all cases where they
would so apply; and wherever any words are used herein in the singular or in the
plural, they shall be construed as though they were used in the plural or the
singular, as the case may be, in all cases where they would so apply.

     11.6 CAPTIONS. The captions of the articles, sections and paragraphs of
this Plan are for convenience only and shall not control or affect the meaning
or construction of any of its provisions.

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     11.7 GOVERNING LAW. The provisions of this Plan shall be construed and
interpreted according to the laws of the State of New Jersey.

     11.8 VALIDITY. In case any provision of this Plan shall be held illegal or
invalid for any reason, said illegality or invalidity shall not affect the
remaining parts hereof, but this Plan shall be construed and enforced as if such
illegal and invalid provision had never been inserted herein.

     11.9 NOTICE. Any notice or filing required or permitted to be given to the
Committee under the Plan shall be sufficient if in writing and hand delivered,
or sent by registered or certified mail, to any member of the Committee, the
President of the Bank or the Bank’s Statutory Agent. Such notice shall be deemed
given as of the date of delivery or, if delivery is made by mail as of three
(3) days following the date shown on the postmark or on the receipt for
registration or certification.

     11.10 SUCCESSORS. The provisions of this Plan shall bind and inure to the
benefit of the Bank and its successors and assigns. The term successors as used
herein shall include any corporate or other business entity which shall, whether
by merger, consolidation, purchase or otherwise acquire all or substantially all
of the business and assets of the Bank and successors of any such corporation or
other business entity.

ARTICLE XII
SPECIAL TRANSITION RULES RELATING TO THE 1995 PLAN

     This Plan is the successor the 1995 Plan which was terminated by the Board
effective upon the effective date of this Plan. The opening balance of the
Deferred Benefit Account of a Participant in this Plan who also participated in
the 1995 Plan shall be equal to the balance of the Participant’s account under
the 1995 Plan on the date immediately preceding the effective date of this Plan.
A Participant’s election under the 1995 Plan with respect to the distribution of
benefits upon termination of service shall remain in effect under this Plan
unless superceded by a new Designation of Form of Payment filed in accordance
with the provisions of this Plan and covering transferred 1995 Plan benefits and
any benefits accrued under this Plan. In all other respects, the terms and
conditions of this Plan shall govern the rights of Participants with respect to
transferred 1995 Plan benefits and any benefits accrued under this Plan. Upon
the filing of a Participation Agreement under this Plan, a Participant who
participated in the 1995 Plan shall be deemed to have consented to the foregoing
modifications and the transfer of their account balances.

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