Exhibit 10.6         Princeton National Bancorp, Inc. Deferred Compensation Plan

                                                                Revised 11/16/01

                        PRINCETON NATIONAL BANCORP, INC.
                           DEFERRED COMPENSATION PLAN


         1. ESTABLISHMENT. Princeton National Bancorp, Inc., a Delaware
corporation (the "Company"), hereby establishes the Princeton National Bancorp,
Inc. Deferred Compensation Plan (the "Plan").

         2. EFFECTIVE DATE. The Plan shall become effective May 1, 2001.

         3. PURPOSE. The Plan has the purpose of advancing the interests of the
Company, the Company's subsidiary corporation and the shareholders of the
Company by helping the Company attract and retain the services of highly
qualified executives, upon whose judgment, initiative and efforts the Company is
substantially dependent. The Plan also has the objective of providing a means
for executives of the Company to accumulate savings through deferral of the
payment of their Compensation and to defer the taxation of such Compensation.

         4. DEFINITIONS

         BANK. The term "Bank" shall mean Citizens First National Bank.

         BOARD OF DIRECTORS. The term "Board of Directors" or "Board" shall mean
the Board of Directors of the Company.

         CHANGE IN CONTROL. A "Change in Control" shall be deemed to occur on
the earliest of:

         (i)      The acquisition by any individual, entity or group (within the
                  meaning of Section 13(d)(3) or 14(d)(2) of the Securities
                  Exchange Act of 1934, as amended (the "Exchange Act")) of
                  beneficial ownership, as that term is defined in Rule 13d-3
                  under the Exchange Act, of capital stock of Bancorp entitled
                  to exercise more than twenty-five percent or more of the
                  outstanding voting power of all capital stock of Bancorp
                  entitled to vote for the election of directors ("Voting
                  Stock");

         (ii)     The commencement by any entity, person, or group (other than
                  Bancorp or a subsidiary of Bancorp) of a tender offer or an
                  exchange offer for more than twenty percent of the outstanding
                  Voting Stock of Bancorp;

         (iii)    The effective time of (A) a merger or consolidation of Bancorp
                  with one or more other corporation as a result of which the
                  holders of the outstanding Voting Stock of Bancorp immediately
                  prior to such merger or consolidation hold less than
                  twenty-five percent of the Voting Stock of the surviving or
                  resulting corporation or (B) a transfer of 25% or more of the
                  Voting Stock, or substantially all of the property of Bancorp,
                  other than to an entity of which Bancorp owns at least 50% of
                  the Voting Stock; or

         (iv)     The effective time of (A) a merger or consolidation of the
                  Bank with one or more other corporations as a result of which
                  the holders of the outstanding Voting Stock



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                  of the Bank immediately prior to such merger or consolidation
                  hold less than twenty-five percent of the Voting Stock of the
                  surviving or resulting corporation or (B) a transfer of 25% or
                  more of the Voting Stock, or substantially all of the property
                  of the Bank, other than to an entity of which Bancorp or the
                  Bank owns at least 50% of the Voting Stock.

         COMPANY. The term "Company" shall mean the Princeton National Bancorp,
Inc., a Delaware Corporation and its successors and assigns.

         COMPENSATION. The term "Compensation shall mean the total salary, bonus
and other cash compensation payable to a Participant.

         COMPENSATION COMMITTEE. The term "Compensation Committee" shall mean
the Compensation Committee of the Company's Board of Directors.

         CREDITING RATE. For any Plan Year, the term "Crediting Rate" shall mean
the prime rate minus one and one-half percent, as published in the Wall Street
Journal as of the first day of the applicable Plan Year.

         DEFERRAL ACCOUNT. The term "Deferral Account" shall have the meaning
given in Paragraph 6 of the Plan.

         DISABILITY. The term "Disability" shall mean a physical or mental
disability, as determined by an independent physician selected with the approval
of both Bancorp and Executive, which will render Executive incapable of
performing his duties under this Agreement for six consecutive months.

         ELECTION AGREEMENT. The term "Election Agreement" shall mean each and
every Election Agreement executed by an Eligible Executive and delivered to the
Company hereunder, the form of which is attached to the Plan as Exhibit A, and
is incorporated by reference herein.

         ELIGIBLE EXECUTIVE. The term "Eligible Executive" shall mean any
present or future executive of the Company, or any affiliate of Company, that
adopts this Plan.

         HARDSHIP. The term "Hardship" shall mean an unforeseeable financial
emergency arising from the death of a family member, sickness, injury,
catastrophe or similar event which can not reasonably be anticipated outside the
control of the Executive.

         PARTICIPANT. The term "Participant" shall mean any past or present
Eligible Executive who has executed and delivered an Election Agreement to the
Company. The Compensation Committee shall have the discretion to determine
whether any executive of the Company shall be




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eligible to participate in this Plan, provided that the executive selected for
participation in the Plan is a member of a select group of management or a
highly compensated employee.

         PAYMENT DATE. The term "Payment Date" shall mean the earliest to occur
of the following dates:

         (i)      The date of the Participant's Termination; or

         (ii)     The Participant's death;

         (iii)    The Participant's cessation of service due to total and
                  permanent disability; or

         (iv)     The date of a Change in Control of the Parent Corporation.

         PLAN. The term "Plan" shall mean the Princeton National Bancorp
Deferred Compensation Plan, as it may be amended from time to time.

         PLAN YEAR. The Plan Year shall be January 1 to December 31, of each
year, except that the first Plan Year shall commence May 1, 2001 and end
December 31, 2001.

         TERMINATION. The term "Termination" shall mean the voluntary or
involuntary resignation of a Participant or the termination of the Participant's
employment with the Company and any subsidiary of the Company with or without
cause. A Termination shall only be considered a Termination under this Plan if
the Participant ceases employment with the Company, the Bank and any other
affiliate of the Company.

         5. EXECUTIVE ELECTIONS. Each Eligible Executive shall be given an
opportunity by the Company on an annual basis to defer Compensation which such
Eligible Executive has the opportunity to earn during the next succeeding Plan
Year through service as an Eligible Executive. In order to participate in the
Plan for a particular Plan Year, an Eligible Executive must elect in writing to
participate, and such election must be made at least one month prior to the
first day of the applicable Plan Year, unless otherwise specified by the
Compensation Committee, except that the election for the first Plan Year may be
made at any time prior to the first day of its effective date. An Eligible
Executive may elect to defer receipt of any portion of Compensation payable for
the next succeeding Plan Year. An Eligible Executive or Participant may not
change an




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election for a Plan Year on or after the first day of that Plan Year, except in
the case of Hardship, as determined by the Compensation Committee.

         To make an effective election, a properly completed and executed
Election Agreement must be received by the Company at the address specified on
such Election Agreement.

         6. DEFERRAL ACCOUNT

         (a) ESTABLISHMENT OF DEFERRAL ACCOUNT. The Company shall establish and
maintain a Deferral Account for each Participant. The Deferral Account shall
reflect all entries required to be made pursuant to the terms and conditions of
the Participant's Election Agreements made under Plan.

         (b) CREDITS TO DEFERRAL ACCOUNT. The Company shall credit to a
Participant's Deferral Account the Compensation that would be payable to the
Participant, had the Participant not elected to participate in the Plan. Such
crediting shall occur as of the date on which the Participant would have
otherwise received the Compensation being deferred pursuant to the Plan absent
the Participant's deferral election.

         The Participant's Deferral Account shall be credit with Matching
Contributions as of the date and in such amount as is determined by the Company
in its sole discretion.

         Any deferrals (together with earnings) returned from the 401(k) Plan
will be deemed to have been deferred to the non-qualified plan.

         The Participant's Deferral Account shall be credited at an annual rate
equal to the Crediting Rate, compounded quarterly, and such credit shall occur
on a quarterly basis, based on the average balance of the Participant's Deferral
Account for that quarter. The Compensation Committee shall keep such records as
are necessary to determine the value of a Participant's Deferral Account. The
Compensation Committee shall adjust the Crediting Rate as of the first day of
each Plan Year.

         7. PAYMENT OF DEFERRAL ACCOUNT VALUE

         (a) DEFERRAL ACCOUNTS. Except as otherwise provided below, the Company
shall, with respect to the Deferral Account for each Participant, cause to be
paid to such



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Participant on or promptly after the applicable Payment Date, the value of such
Deferral Account in ten substantially equal annual payments, which shall be
determined by assuming that the rate of return on the Deferral Account, while it
is being paid to the Participant, is the Crediting Rate in effect on the Payment
Date, all pursuant to the express terms and conditions of the Plan and the
applicable Election Agreement. If the Payment Date is the date of a Change in
Control of the Parent Corporation, he or she may elect not to receive payment on
such date, and instead elect to receive payments under this Plan as of the next
applicable Payment Date. Such election must be made at least 90 days before, and
in the calendar year prior the date of the Change in Control. In lieu of 10
substantially equal annual payments, a Participant may elect to receive a lump
sum payment of his or her Deferral Account balance, as of his or her Payment
Date, provided that such election is made at least 90 days before and in the
calendar year prior to the Payment Date.

         (b) DISABILITY. If a Payment Date occurs by reason of a determination
by the Company that the Participant has become totally and permanently disabled,
and if the disability is due to mental incapacity, any cash payable shall be
paid to the Participant's legally appointed personal representative. If no such
representative has been appointed, then payment shall be made to the
Participant's spouse, or if the Participant is then unmarried, then cash to be
paid shall be held until the persons, who would be entitled thereto if the
Participant were then to die intestate, make proper claim to the Company for
such amount. Such payment shall be made to the Participant if the disability is
not due to mental incapacity.

         (c) DEATH. If a Payment Date occurs because the Participant dies, any
cash to be paid shall be promptly paid to the Participant's beneficiary (or
beneficiaries) as designated in the applicable Election Agreement, or, if none
are so designated, in the name of and to the legally appointed personal
representative of the Participant's estate. If no legal proceedings for such
appointment have been instituted within sixty days after receipt by the Company
of notice of the Participant's death, such payment shall be made as if no legal
representative has been appointed in accordance with Paragraph 7.(b) above.
Notwithstanding the foregoing, if cash payments have already commenced to a
Participant and the Participant dies, the remaining payments shall be made to
the individuals or entities as otherwise determined in this Paragraph 7.(c),
7.(d), at the same time such payments would have been made to the Participant.

         (d) HARDSHIP. Upon the Committee's determination of a Participant's
Hardship, a distribution of all or part of a Participant's Account Balance may
be made, provided that the amount distributed does not exceed the amount
necessary to relieve the Hardship.

         8. ADMINISTRATION. The Compensation Committee shall be generally
responsible for the administration of the Plan, but may delegate any portion of
such responsibility that the Board determines to be appropriate. The
Compensation Committee shall have the power to interpret any Plan provision, to
prescribe, amend and rescind rules and regulations relating to the Plan and to
make all other determinations that they deem necessary or advisable to
administer the Plan. The




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Compensation Committee shall establish a claims procedure for the Plan to
resolve any disputes that may arise in the administration of the Plan. The
Company shall be the named fiduciary of the Plan.

         9. STATUS OF DEFERRAL ACCOUNTS. The Company shall have full and
unrestricted use of all property or amounts payable pursuant to the Plan, and
title to and beneficial ownership of any assets which the Company may earmark to
pay the amounts hereunder shall at all times remain in the Company and no
Eligible Executive shall have any property interest whatsoever in any specific
assets of the Company. The Deferral Account is not intended to be a trust
account or escrow account for the benefit of a Participant or any other person,
or an asset segregation for the benefit of a Participant or any other person.
The sole right of a Participant, or a Participant's heirs or personal
representatives, is a right as an unsecured general creditor of the Company to
claim any dollar amounts consistent with the Participant's Election Agreement
and the Plan. Notwithstanding the above provisions, the Company may establish a
grantor trust to provide additional security to Participants that amounts under
this Plan will be properly paid, provided that the status of Participants with
respect to assets of the grantor trust remains that of general unsecured
creditors. In addition, the Company or the Bank may purchase insurance on a
Participant's life to provide for the payment of the Participant's Account
Balance, provided that the Company or the Bank is the sole owner of such
insurance. In the event insurance is purchased on the life of a Participant, and
the Participant commits suicide within two years following the purchase of such
insurance or the Participant makes a material misstatement of fact on an
application for such life insurance, then the Participant shall forfeit the
portion of his or her Account Balance equal to the premiums paid by the Company
for such insurance. The Company shall provide each Participant with an annual
report of his or her Deferral Account balances within 30 days following the end
of each Plan Year.

         10. AMENDMENT OR TERMINATION. The Compensation Committee may, at any
time and from time to time, terminate the Plan or make such amendments as it
deems advisable; provided, however, that no such termination or amendment shall
adversely affect or impair the contract rights of a Participant with respect to
an effective Election Agreement, unless such Participant shall consent in
writing to such termination or amendment. The Compensation Committee's right to
amend the Plan shall include the right to amend prospectively the Crediting Rate
and to change the form of payments that may be made from the Plan.

         11. NON-PLAN DEFERRAL ARRANGEMENTS. The Company does not intend that
this Plan affect any presently existing deferral arrangement or preclude the
Company from implementing additional deferral arrangements.

         12. COSTS OF ENFORCEMENT. The Company shall pay all expenses of a
Participant, including but not limited to attorney fees, incurred in enforcing
payments by the Company pursuant to this Plan.




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         13. FUTURE EMPLOYMENT. Nothing in this Plan or in any Election
Agreement shall obligate a Participant to continue to serve as an executive, or
require the Company to employ the Participant for any period of time. For
purposes of this provision, the term "Company" shall include any affiliate of
the Company that adopts this Plan.

         14. NO ALIENATION. No amounts deliverable under the Plan or under an
Election Agreement shall be subject in any manner to anticipation, alienation,
sale, transfer, assignment, pledge, encumbrances or change, other than by will
or the laws of descent and distribution.

         15. WITHHOLDING. The Company is entitled to withhold and deduct from
any amounts due from the Company to a Participant, all legally required amounts
necessary to satisfy any federal, state or local withholding and
employment-related taxes arising directly or indirectly in connection with the
Plan or any Election Agreement, and the Company may require the Participant to
remit promptly to the Company the amount of such taxes before taking any future
actions with respect to the Participant's Deferral Accounts or Election
Agreements. For purposes of this provision, the term "Company" shall include the
any affiliate of the Company that has adopted this Plan.

         16. BINDING EFFECT. This Agreement shall bind the Participant, the
Company and any affiliate of the Company that has adopted the Plan, and their
beneficiaries, survivors, executors, administrators and transferees.

         17. APPLICABLE LAW. The Agreement and all rights hereunder shall be
governed by the laws of Illinois, except to the extent preempted by the laws of
the United States of America.


                                  CERTIFICATION





         The foregoing Plan was duly adopted by the Board of Directors on April
9, 2001 and amended on November 16, 2001.



                                   PRINCETON NATIONAL BANCORP, INC.



                                   By: /s/ Lou Ann Birkey
                                      ------------------------------------------

                                   Its:   Vice President - Investor Relations &
                                          Corporate Secretary




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                                    EXHIBIT A



                        PRINCETON NATIONAL BANCORP, INC.

                           DEFERRED COMPENSATION PLAN

                               ELECTION AGREEMENT







                                DEFERRAL ELECTION



         For the Plan Year beginning January 1, 2002 and ending December 31,
2002:



|_|      I elect to defer _____% of the Compensation payable to me by the
         Company in exchange for payment in cash upon the applicable Payment
         Date in accordance with the Plan. Notwithstanding the foregoing
         election, in no event do I wish to defer Compensation in excess of
         $________. (If the latter blank is not completed, there will be no
         dollar limit on the Compensation deferred for the above referenced Plan
         Year.



|_|      I elect to defer $_________ of the Compensation payable to me by the
         Company in exchange for payment in cash upon the applicable Payment
         Date in accordance with the Plan. I will start at _____% and increase
         the percentage when I reach the 401(k) maximum deferral amount of
         $_________. Notwithstanding the foregoing election, in no event do I
         wish to defer Compensation in excess of $_________.



|_|      I elect to receive payment of my Deferral Account under the Plan in a
         single lump sum as of the Payment Date determined in accordance with
         the Plan.



|_|      I elect to receive payment of my Deferral Account under the Plan in
         ____ (not to exceed 10) substantially equal annual payments commencing
         as of the Payment Date determined in accordance with the Plan.





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                                 FORM OF BENEFIT



         Except as described below, your benefit payment will be paid or
commence to be paid upon your first Payment Date under the Plan. "Payment Date"
means the earliest of your Termination, as defined in the Plan (which includes
voluntary or involuntary resignation), your death, the date of a Change in
Control or your total and permanent disability. If your first Payment Date is
the date of a Change in Control, you may elect to commence receiving your
benefit payment on the next Payment Date, provided that you make such election
in writing and delivered to the Company's Secretary at least 90 days prior to
and in the calendar year preceding the date of the Change in Control.

         This Election Agreement must be delivered to the Company at Princeton
National Bancorp, Inc., 606 South Main Street, Princeton, Illinois 61356;
Attention: Secretary at least one month prior to the first day of the applicable
Plan Year, unless otherwise specified by the Compensation Committee.







                                              __________________________________


                                              Dated: ___________________________





Accepted by the Company this ____ day of _______________________________.





By:  __________________________________



Its: __________________________________