| Pennsylvania(State or other jurisdiction ofincorporation or organization) | 23-2222567(I.R.S. Employer Identification No.) |
|---------------------------------------------------------------------------|------------------------------------------------|

| Yes x |   | No o |
|-------|--------|------|

| Yes o |   | No o |
|-------|--------|------|

| Large accelerated filer    o     | Accelerated filer                  o |
|------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------|
| Non-accelerated filer     o | Smaller reporting company x                                                                                               |

| Yes o |   | No x |
|------------|--------|------|

| Common Stock ($1.00 Par Value)(Class) | 2,603,323(Shares Outstanding as of August 10, 2009) |
|---------------------------------------|-----------------------------------------------------|

----

|          |   | PART  I - FINANCIAL INFORMATION                                             | PAGE NO. |
|---------------|--------|---------------------------------------------------------------------------------------|----------|
|          |   |                                                                                  |     |
| ITEM 1.       |   | FINANCIAL STATEMENTS (Unaudited):                                                     |     |
|          |   |                                                                                  |     |
|          |   | CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION                                        |     |
|          |   | June 30, 2009 and December 31, 2008                                                   | 3        |
|          |   |                                                                                  |     |
|          |   | CONSOLIDATED STATEMENTS OF OPERATIONS                                                 |     |
|          |   | Three and Six Months Ended June 30, 2009 and 2008                                     | 4        |
|          |   |                                                                                  |     |
|          |   | CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND COMPREHENSIVE INCOME (LOSS) | 5        |
|          |   | Six Months Ended June 30, 2009 and 2008                                               |     |
|          |   |                                                                                  |     |
|          |   | CONSOLIDATED STATEMENTS OF CASH FLOWS                                                 |     |
|          |   | Six Months Ended June 30, 2009 and 2008                                               | 6        |
|          |   |                                                                                  |     |
|          |   | NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                                            | 7        |
|          |   |                                                                                  |     |
| ITEM 2.       |   | MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 18       |
|          |   |                                                                                  |     |
|          |   |                                                                                  |     |
| ITEM 3.       |   | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                            | 29       |
|          |   |                                                                                  |     |
| ITEM 4T.      |   | CONTROLS AND PROCEDURES                                                               | 29       |
|          |   |                                                                                  |     |
|          |   | PART II - OTHER INFORMATION                                                           |     |
|          |   |                                                                                  |     |
| ITEM 1.       |   | LEGAL PROCEEDINGS                                                                     | 30       |
|          |   |                                                                                  |     |
| ITEM 1A.      |   | RISK FACTORS                                                                          | 30       |
|          |   |                                                                                  |     |
| ITEM 2.       |   | UNREGISTERED SALES OF EQUITY  SECURITIES AND USE OF PROCEEDS                | 30       |
|          |   |                                                                                  |     |
| ITEM 3.       |   | DEFAULTS UPON SENIOR SECURITIES                                                       | 30       |
|          |   |                                                                                  |     |
| ITEM 4.       |   | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                   | 30       |
|          |   |                                                                                  |     |
| ITEM 5.       |   | OTHER INFORMATION                                                                     | 31       |
|          |   |                                                                                  |     |
| ITEM 6.       |   | EXHIBITS                                                                              | 31       |
|          |   |                                                                                  |     |
| SIGNATURES    | 32     |
|          |   |                                                                                  |     |
| EXHIBIT INDEX |   |
|          |   |                                                                                  |     |

----

DNB 

|                                                                                                                                                                                                  |   |    |    |   |        |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------|---------|--------|-------------|--------|
|                                                                                                                                                                                                  |   | June 30 |    |   | December 31 |   |
| (Dollars in thousands except share data)                                                                                                                                                              |   | 2009    |    |   | 2008        |   |
| Assets                                                                                                                                                                                                |   |    |    |   |        |   |
| Cash and due from banks                                                                                                                                                                               |   | $       | 10,954  |   |        | $      | 9,780 |   |
| Federal funds sold                                                                                                                                                                                    |   |    | 39,636  |   |        |   | 38,338 |   |
| Cash and cash equivalents                                                                                                                                                                             |   |    | 50,590  |   |        |   | 48,118 |   |
| AFS investment securities, at fair value (amortized cost of $148,002    and $61,265)                                                                                              |   |    | 145,996 |   |        |   | 60,666 |   |
| HTM investment securities (fair value of $50,416 and $58,525)                                                                                                                                         |   |    | 51,231  |   |        |   | 59,395 |   |
| Other investment securities                                                                                                                                                                           |   |    | 4,067   |   |        |   | 4,065 |   |
| Total investment securities                                                                                                                                                                           |   |    | 201,294 |   |        |   | 124,126 |   |
| Loans and leases                                                                                                                                                                                      |   |    | 333,151 |   |        |   | 336,454 |   |
| Allowance for credit losses                                                                                                                                                                           |   |    | (4,920  | )      |        |   | (4,586 | ) |
| Net loans and leases                                                                                                                                                                                  |   |    | 328,231 |   |        |   | 331,868 |   |
| Office property and equipment, net                                                                                                                                                                    |   |    | 9,331   |   |        |   | 9,665 |   |
| Accrued interest receivable                                                                                                                                                                           |   |    | 2,555   |   |        |   | 2,127 |   |
| Other real estate owned                                                                                                                                                                               |   |    | 4,750   |   |        |   | 4,997 |   |
| Bank owned life insurance                                                                                                                                                                             |   |    | 7,707   |   |        |   | 7,580 |   |
| Core deposit intangible                                                                                                                                                                               |   |    | 234     |   |        |   | 259 |   |
| Net deferred taxes                                                                                                                                                                                    |   |    | 3,798   |   |        |   | 3,496 |   |
| Other assets                                                                                                                                                                                          |   |    | 1,325   |   |        |   | 1,211 |   |
| Total assets                                                                                                                                                                                          |   | $       | 609,815 |   |        | $      | 533,447 |   |
| Liabilities and Stockholders’ Equity                                                                                                                                                            |   |    |    |   |        |   |   |   |
| Liabilities                                                                                                                                                                                           |   |    |    |   |        |   |   |   |
| Non-interest-bearing deposits                                                                                                                                                                         |   | $       | 47,356  |   |        | $      | 45,503 |   |
| Interest-bearing deposits:                                                                                                                                                                            |   |    |    |   |        |   |   |   |
| NOW                                                                                                                                                                                                   |   |    | 128,324 |   |        |   | 106,623 |   |
| Money market                                                                                                                                                                                          |   |    | 96,546  |   |        |   | 81,742 |   |
| Savings                                                                                                                                                                                               |   |    | 34,705  |   |        |   | 32,895 |   |
| Time                                                                                                                                                                                                  |   |    | 143,830 |   |        |   | 141,707 |   |
| Total deposits                                                                                                                                                                                        |   |    | 450,761 |   |        |   | 408,470 |   |
| FHLB advances                                                                                                                                                                                         |   |    | 60,000  |   |        |   | 60,000 |   |
| Federal Reserve borrowing                                                                                                                                                                             |   |    | 20,500  |   |        |   | — |   |
| Repurchase agreements                                                                                                                                                                                 |   |    | 23,463  |   |        |   | 20,185 |   |
| Junior subordinated debentures                                                                                                                                                                        |   |    | 9,279   |   |        |   | 9,279 |   |
| Other borrowings                                                                                                                                                                                      |   |    | 651     |   |        |   | 659 |   |
| Total borrowings                                                                                                                                                                                      |   |    | 113,893 |   |        |   | 90,123 |   |
| Accrued interest payable                                                                                                                                                                              |   |    | 803     |   |        |   | 1,154 |   |
| Other liabilities                                                                                                                                                                                     |   |    | 3,552   |   |        |   | 3,642 |   |
| Total liabilities                                                                                                                                                                                     |   |    | 569,009 |   |        |   | 503,389 |   |
| Stockholders’ Equity                                                                                                                                                                            |   |    |    |   |        |   |   |   |
| Preferred stock, $10.00 par value;                                                                                                                                                                    |   |    |    |   |        |   |   |   |
| 1,000,000 shares authorized; $1,000 liquidation preference per share ;          11,750 issued at June 30, 2009 and none issued at December 31, 2008 |   |    | 11,612  |   |        |   | — |   |
| Common stock, $1.00 par value;                                                                                                                                                                        |   |    |    |   |        |   |   |   |
|         10,000,000 shares authorized; 2,861,619 and 2,863,024 issued respectively                                                                             |   |    | 2,871   |   |        |   | 2,867 |   |
| Stock warrants                                                                                                                                                                                        |   |    | 151     |   |        |   | — |   |
| Treasury stock, at cost; 258,296 and 256,420 shares, respectively                                                                                                                                     |   |    | (4,828  | )      |        |   | (4,811 | ) |
| Surplus                                                                                                                                                                                               |   |    | 35,129  |   |        |   | 35,082 |   |
| Accumulated deficit                                                                                                                                                                                   |   |    | (1,218  | )      |        |   | (1,062 | ) |
| Accumulated other comprehensive loss, net                                                                                                                                                             |   |    | (2,911  | )      |        |   | (2,018 | ) |
| Total stockholders’ equity                                                                                                                                                                      |   |    | 40,806  |   |        |   | 30,058 |   |
| Total liabilities and stockholders’ equity                                                                                                                                                      |   | $       | 609,815 |   |        | $      | 533,447 |   |
| See accompanying notes to unaudited consolidated financial statements.                                                                                                                                |   |    |    |   |        |   |   |   |

----

DNB 

|                                                                   |   |                             |      |   |                           |   |
|------------------------------------------------------------------------|--------|----------------------------------|-----------|--------|--------------------------------|--------|
|                                                                   |   | Three Months Ended June 30, |      |   | Six Months Ended June 30, |   |
| (Dollars in thousands except share data)                               |   | 2009                             |      |   | 2008                           |   |   | 2009 |   |   | 2008 |   |
| Interest Income:                                                       |   |                             |      |   |                           |   |   |   |   |   |   |   |
| Interest and fees on loans and leases                                  |   | $                                | 4,698     |   |                           | $      | 4,637 |   |   | $ | 9,413 |   |   | $ | 9,553 |   |
| Interest and dividends on investment securities:                       |   |                             |      |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|  Taxable                                                          |   |                             | 1,590     |   |                           |   | 2,092 |   |   |   | 2,920 |   |   |   | 4,261 |   |
|  Exempt from federal taxes                                        |   |                             | 47        |   |                           |   | 44 |   |   |   | 96 |   |   |   | 87 |   |
| Interest on cash and cash equivalents                                  |   |                             | 15        |   |                           |   | 110 |   |   |   | 34 |   |   |   | 254 |   |
| Total interest income                                                  |   |                             | 6,350     |   |                           |   | 6,883 |   |   |   | 12,463 |   |   |   | 14,155 |   |
| Interest Expense:                                                      |   |                             |      |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Interest on NOW, money market and savings                              |   |                             | 663       |   |                           |   | 975 |   |   |   | 1,202 |   |   |   | 2,030 |   |
| Interest on time deposits                                              |   |                             | 985       |   |                           |   | 1,042 |   |   |   | 2,105 |   |   |   | 2,665 |   |
| Interest on FHLB advances                                              |   |                             | 736       |   |                           |   | 736 |   |   |   | 1,465 |   |   |   | 1,413 |   |
| Interest on Federal Reserve borrowing                                  |   |                             | 10        |   |                           |   | — |   |   |   | 10 |   |   |   | — |   |
| Interest on repurchase agreements                                      |   |                             | 74        |   |                           |   | 118 |   |   |   | 143 |   |   |   | 287 |   |
| Interest on junior subordinated debentures                             |   |                             | 135       |   |                           |   | 155 |   |   |   | 273 |   |   |   | 317 |   |
| Interest on other borrowings                                           |   |                             | 22        |   |                           |   | 23 |   |   |   | 44 |   |   |   | 46 |   |
| Total interest expense                                                 |   |                             | 2,625     |   |                           |   | 3,049 |   |   |   | 5,242 |   |   |   | 6,758 |   |
| Net interest income                                                    |   |                             | 3,725     |   |                           |   | 3,834 |   |   |   | 7,221 |   |   |   | 7,397 |   |
| Provision for credit losses                                            |   |                             | 300       |   |                           |   | 454 |   |   |   | 400 |   |   |   | 514 |   |
| Net interest income after provision for credit losses                  |   |                             | 3,425     |   |                           |   | 3,380 |   |   |   | 6,821 |   |   |   | 6,883 |   |
| Non-interest Income:                                                   |   |                             |      |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Service charges on deposits                                            |   |                             | 357       |   |                           |   | 393 |   |   |   | 744 |   |   |   | 778 |   |
| Wealth management fees                                                 |   |                             | 157       |   |                           |   | 236 |   |   |   | 331 |   |   |   | 521 |   |
| Increase in cash surrender value of BOLI                               |   |                             | 64        |   |                           |   | 63 |   |   |   | 127 |   |   |   | 129 |   |
| Gain on sale of securities                                             |   |                             | 49        |   |                           |   | 481 |   |   |   | 551 |   |   |   | 737 |   |
| Other fees                                                             |   |                             | 237       |   |                           |   | 214 |   |   |   | 389 |   |   |   | 422 |   |
| Total non-interest income                                              |   |                             | 864       |   |                           |   | 1,387 |   |   |   | 2,142 |   |   |   | 2,587 |   |
| Non-interest Expense:                                                  |   |                             |      |   |                           |   |   |   |   |   |   |   |   |   |   |   |
| Salaries and employee benefits                                         |   |                             | 1,966     |   |                           |   | 2,256 |   |   |   | 4,089 |   |   |   | 4,605 |   |
| Furniture and equipment                                                |   |                             | 411       |   |                           |   | 460 |   |   |   | 809 |   |   |   | 881 |   |
| Occupancy                                                              |   |                             | 382       |   |                           |   | 368 |   |   |   | 825 |   |   |   | 767 |   |
| Professional and consulting                                            |   |                             | 349       |   |                           |   | 314 |   |   |   | 706 |   |   |   | 641 |   |
| Advertising and marketing                                              |   |                             | 107       |   |                           |   | 189 |   |   |   | 176 |   |   |   | 272 |   |
| Printing and supplies                                                  |   |                             | 60        |   |                           |   | 93 |   |   |   | 99 |   |   |   | 144 |   |
| FDIC insurance                                                         |   |                             | 539       |   |                           |   | 72 |   |   |   | 621 |   |   |   | 136 |   |
| Other expenses                                                         |   |                             | 565       |   |                           |   | 479 |   |   |   | 1,159 |   |   |   | 979 |   |
| Total non-interest expense                                             |   |                             | 4,379     |   |                           |   | 4,231 |   |   |   | 8,484 |   |   |   | 8,425 |   |
| Income (loss) before income taxes (benefit)                            |   |                             | (90       | )      |                           |   | 536 |   |   |   | 479 |   |   |   | 1,045 |   |
| Income tax (benefit) expense                                           |   |                             | (51       | )      |                           |   | 105 |   |   |   | 39 |   |   |   | 205 |   |
| Net (Loss) Income                                                      |   | $                                | (39       | )      |                           | $      | 431 |   |   | $ | 440 |   |   | $ | 840 |   |
| Preferred stock dividends and accretion of discount                    |   |                             | 147       |   |                           |   | — |   |   |   | 245 |   |   |   | — |   |
| Net (Loss)Income available to Common Shareholders                      |   | $                                | (186      | )      |                           | $      | 431 |   |   | $ | 195 |   |   | $ | 840 |   |
| Earnings (loss) per common share:                                      |   |                             |      |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|  Basic                                                            |   | $                                | (0.07     | )      |                           | $      | 0.17 |   |   | $ | 0.07 |   |   | $ | 0.32 |   |
|  Diluted                                                          |   | $                                | (0.07     | )      |                           | $      | 0.17 |   |   | $ | 0.07 |   |   | $ | 0.32 |   |
| Cash dividends per common share                                        |   | $                                | 0.07      |   |                           | $      | 0.13 |   |   | $ | 0.14 |   |   | $ | 0.26 |   |
| Weighted average common shares outstanding:                            |   |                             |      |   |                           |   |   |   |   |   |   |   |   |   |   |   |
|  Basic                                                            |   |                             | 2,603,255 |   |                           |   | 2,600,292 |   |   |   | 2,603,131 |   |   |   | 2,598,397 |   |
|  Diluted                                                          |   |                             | 2,603,255 |   |                           |   | 2,603,828 |   |   |   | 2,603,131 |   |   |   | 2,602,201 |   |
| See accompanying notes to unaudited consolidated financial statements. |   |

----

DNB 

|                                          |   | Preferred Stock |    |   | CommonStock |   |    | StockWarrants |   |    | TreasuryStock |   |   | Surplus |    |   | AccumulatedDeficit |   |    | AccumulatedOtherCompre-hensiveLoss |   |   | Total   |   |
|-----------------------------------------------|--------|-----------------|---------|--------|-------------|--------|---------|---------------|--------|---------|---------------|--------|--------|---------|---------|--------|--------------------|--------|---------|------------------------------------|--------|--------|---------|--------|
|                                          |   |            |    |   |        |   |    |          |   |    |          |   |   |    |    |   |               |   |    |                               |   |   |    |   |
| Balance at January 1, 2009               |   | $          | — |   |        | $      | 2,867   |          |   | $  | —       |   |   | $       | (4,811  | )      |               | $      | 35,082  |                               |   | $      | (1,062  | )      |   | $ | (2,018 | ) |   | $ | 30,058 |   |
| Comprehensive loss:                           |   |            |    |   |        |   |    |          |   |    |          |   |   |    |    |   |               |   |    |                               |   |   |    |   |   |   |   |   |   |   |   |   |
| Net income for six months ended June 30, 2009 |   |            | — |   |        |   | — |          |   |    | —       |   |   |    | — |   |               |   | — |                               |   |   | 440     |   |   |   | — |   |   |   | 440 |   |
| Other comprehensive loss, net of tax:         |   |            |    |   |        |   |    |          |   |    |          |   |   |    |    |   |               |   |    |                               |   |   |    |   |   |   |   |   |   |   |   |   |
| Unrealized losses on AFS securities, net      |   |            | — |   |        |   | — |          |   |    | —       |   |   |    | — |   |               |   | — |                               |   |   | — |   |   |   | (893 | ) |   |   | (893 | ) |
| Total comprehensive loss                      |   |            | — |   |        |   | — |          |   |    | —       |   |   |    | — |   |               |   | — |                               |   |   | — |   |   |   | — |   |   |   | (453 | ) |
| Issuance of preferred stock                   |   |            | 11,599  |   |        |   | — |          |   |    | —       |   |   |    | — |   |               |   | — |                               |   |   | — |   |   |   | — |   |   |   | 11,599 |   |
| Preferred stock discount amortization         |   |            | 13      |   |        |   | — |          |   |    | —       |   |   |    | — |   |               |   | — |                               |   |   | (13     | )      |   |   | — |   |   |   | — |   |
| Stock warrants issued                         |   |            | — |   |        |   | — |          |   |    | 151           |   |   |    | — |   |               |   | — |                               |   |   | — |   |   |   | — |   |   |   | 151 |   |
| Release of unvested stock                     |   |            | — |   |        |   | 4       |          |   |    | —       |   |   |    | — |   |               |   | 47      |                               |   |   | — |   |   |   | — |   |   |   | 51 |   |
| Cash dividends-Common ($.14 per share)        |   |            | — |   |        |   | — |          |   |    | —       |   |   |    | — |   |               |   | — |                               |   |   | (338    | )      |   |   | — |   |   |   | (338 | ) |
| Cash dividends-Preferred                      |   |            | — |   |        |   | — |          |   |    | —       |   |   |    | — |   |               |   | — |                               |   |   | (171    | )      |   |   | — |   |   |   | (171 | ) |
| Purchase of treasury shares (2,454 shares)    |   |            | — |   |        |   | — |          |   |    | —       |   |   |    | (17     | )      |               |   | — |                               |   |   | — |   |   |   | — |   |   |   | (17 | ) |
| Preferred stock dividends accrued             |   |            | — |   |        |   | — |          |   |    | —       |   |   |    | — |   |               |   | — |                               |   |   | (74     | )      |   |   | — |   |   |   | (74 | ) |
| Balance at June 30, 2009                 |   | $               | 11,612  |   |        | $      | 2,871   |          |   | $       | 151           |   |   | $       | (4,828  | )      |               | $      | 35,129  |                               |   | $      | (1,218  | )      |   | $ | (2,911 | ) |   | $ | 40,806 |   |

|                                             |   |        |    |   |          |   |    |    |   |   |               |   |   |                                       |    |   |   |   |
|--------------------------------------------------|--------|-------------|---------|--------|---------------|--------|---------|---------|--------|--------|--------------------|--------|--------|--------------------------------------------|---------|--------|--------|--------|
|                                             |   | CommonStock |    |   | TreasuryStock |   |    | Surplus |   |   | AccumulatedDeficit |   |   | AccumulatedOtherCompre-hensiveIncome(Loss) |    |   | Total  |   |
|                                             |   |        |    |   |          |   |    |    |   |   |               |   |   |                                       |    |   |   |   |
| Balance at January 1, 2008                  |   | $           | 2,860   |   |          | $      | (4,757  | )       |   | $      | 34,888             |   |   | $                                          | (771    | )      |   | $      | 415 |   |   | $ | 32,635 |   |
| Comprehensive loss:                              |   |        |    |   |          |   |    |    |   |   |               |   |   |                                       |    |   |   |   |   |   |   |   |   |   |
| Net income for six months ended June 30, 2008    |   |        | — |   |          |   | — |    |   |   | —            |   |   |                                       | 840     |   |   |   | — |   |   |   | 840 |   |
| Other comprehensive loss, net of tax:            |   |        |    |   |          |   |    |    |   |   |               |   |   |                                       |    |   |   |   |   |   |   |   |   |   |
| Unrealized losses on AFS securities, net         |   |        | — |   |          |   | — |    |   |   | —            |   |   |                                       | — |   |   |   | (2,127 | ) |   |   | (2,127 | ) |
| Unrealized actuarial losses — pension, net |   |        | — |   |          |   | — |    |   |   | —            |   |   |                                       | — |   |   |   | (169 | ) |   |   | (169 | ) |
| Total comprehensive loss                         |   |        | — |   |          |   | — |    |   |   | —            |   |   |                                       | — |   |   |   | — |   |   |   | (1,456 | ) |
| Release of unvested stock                        |   |        | 5       |   |          |   | — |    |   |   | 79                 |   |   |                                       | — |   |   |   | — |   |   |   | 84 |   |
| Cash dividends ($.26 per share)                  |   |        | — |   |          |   | — |    |   |   | —            |   |   |                                       | (680    | )      |   |   | — |   |   |   | (680 | ) |
| Purchase of treasury shares (5,662 shares)       |   |        | — |   |          |   | (261    | )       |   |   | —            |   |   |                                       | — |   |   |   | — |   |   |   | (261 | ) |
| Sale of treasury shares to 401-K plan            |   |        | — |   |          |   | 230     |    |   |   | (55                | )      |   |                                       | — |   |   |   | — |   |   |   | 175 |   |
| Deferred Compensation Plan                       |   |        | — |   |          |   | — |    |   |   | 80                 |   |   |                                       | — |   |   |   | — |   |   |   | 80 |   |
| Stock compensation tax benefit                   |   |        | — |   |          |   | — |    |   |   | 22                 |   |   |                                       | — |   |   |   | — |   |   |   | 22 |   |
| Balance at June 30, 2008                    |   | $           | 2,865   |   |          | $      | (4,788  | )       |   | $      | 35,014             |   |   | $                                          | (611    | )      |   | $      | (1,881 | ) |   | $ | 30,599 |   |

----

DNB 

|                                                                              |   |                     |     |
|-----------------------------------------------------------------------------------|--------|--------------------------|----------|
|                                                                              |   | Six Months EndedJune 30, |     |
| (Dollars in thousands)                                                            |   | 2009                     |     |   | 2008 |   |
| Cash Flows From Operating Activities:                                             |   |                     |     |   |   |   |
| Net income                                                                        |   | $                        | 440      |   |   | $ | 840 |   |
| Adjustments to reconcile net income to net cash                                   |   |                     |     |   |   |   |   |   |
|  provided by operating activities:                                           |   |                     |     |   |   |   |   |   |
| Depreciation, amortization and accretion                                          |   |                     | 1,098    |   |   |   | 689 |   |
| Provision for credit losses                                                       |   |                     | 400      |   |   |   | 514 |   |
| Unvested stock amortization                                                       |   |                     | 51       |   |   |   | 84 |   |
| Net gain on sale of securities                                                    |   |                     | (551     | ) |   |   | (737 | ) |
| Net loss on sale of OREO and other repossessed property                           |   |                     | 78       |   |   |   | — |   |
| (Increase) decrease in interest receivable                                        |   |                     | (428     | ) |   |   | 320 |   |
| (Increase) decrease in other assets                                               |   |                     | (114     | ) |   |   | 196 |   |
| Earnings from investment in BOLI                                                  |   |                     | (127     | ) |   |   | (129 | ) |
| Decrease in interest payable                                                      |   |                     | (351     | ) |   |   | (572 | ) |
| Increase in deferred tax benefit (expense)                                        |   |                     | 176      |   |   |   | (138 | ) |
| Decrease in other liabilities                                                     |   |                     | (163     | ) |   |   | (448 | ) |
| Net Cash Provided By Operating Activities                                         |   |                     | 509      |   |   |   | 619 |   |
| Cash Flows From Investing Activities:                                             |   |                     |     |   |   |   |   |   |
| Activity in available-for-sale securities:                                        |   |                     |     |   |   |   |   |   |
| Sales                                                                             |   |                     | 54,269   |   |   |   | 71,523 |   |
| Maturities, repayments and calls                                                  |   |                     | 12,283   |   |   |   | 12,597 |   |
| Purchases                                                                         |   |                     | (153,123 | ) |   |   | (86,744 | ) |
| Activity in held-to-maturity securities:                                          |   |                     |     |   |   |   |   |   |
| Maturities, repayments and calls                                                  |   |                     | 10,200   |   |   |   | 4,876 |   |
| Purchases                                                                         |   |                     | (2,023   | ) |   |   | (8,936 | ) |
| Net increase in other investments                                                 |   |                     | (2       | ) |   |   | (694 | ) |
| Net (increase) decrease in loans and leases                                       |   |                     | 3,043    |   |   |   | (10,113 | ) |
| Proceeds from sale of OREO and other repossessed property                         |   |                     | 363      |   |   |   | — |   |
| Purchase of bank property and equipment                                           |   |                     | (332     | ) |   |   | (492 | ) |
| Net Cash Used By Investing Activities                                             |   |                     | (75,322  | ) |   |   | (17,983 | ) |
| Cash Flows From Financing Activities:                                             |   |                     |     |   |   |   |   |   |
| Net increase (decrease) in deposits                                               |   |                     | 42,291   |   |   |   | (9,625 | ) |
| Increase in FHLB advances                                                         |   |                     | —  |   |   |   | 10,000 |   |
| Increase in Federal Reserve borrowings                                            |   |                     | 20,500   |   |   |   | — |   |
| Increase (decrease) in short term repurchase agreements                           |   |                     | 3,278    |   |   |   | (12,557 | ) |
| Decrease in lease obligations                                                     |   |                     | (8       | ) |   |   | (7 | ) |
| Dividends paid                                                                    |   |                     | (509     | ) |   |   | (680 | ) |
| Issuance of preferred stock and warrants                                          |   |                     | 11,750   |   |   |   | — |   |
| Purchase of treasury stock                                                        |   |                     | (17      | ) |   |   | (86 | ) |
| Net Cash Provided (Used) By Financing Activities                                  |   |                     | 77,285   |   |   |   | (12,955 | ) |
| Net Change in Cash and Cash Equivalents                                      |   |                     | 2,472    |   |   |   | (30,319 | ) |
| Cash and Cash Equivalents at Beginning of Period                             |   |                     | 48,118   |   |   |   | 45,331 |   |
| Cash and Cash Equivalents at End of Period                                        |   | $                        | 50,590   |   |   | $ | 15,012 |   |
| Supplemental Disclosure of Cash Flow Information:                                 |   |                     |     |   |   |   |   |   |
| Cash paid during the period for:                                                  |   |                     |     |   |   |   |   |   |
|  Interest                                                                    |   | $                        | 5,593    |   |   | $ | 7,330 |   |
|  Income taxes                                                                |   |                     | 402      |   |   |   | 488 |   |
| Supplemental Disclosure of Non-cash Flow Information:                             |   |                     |     |   |   |   |   |   |
| Change in unrealized losses on investment securities                              |   | $                        | (1,406   | ) |   | $ | (3,224 | ) |
| Change in deferred taxes due to change in unrealized                              |   |                     |     |   |   |   |   |   |
|  losses on investment securities                                             |   |                     | 478      |   |   |   | 1,096 |   |
| Change in unsettled securities purchased  included in other liabilities |   |                     | —  |   |   |   | (5,940 | ) |
| Transfers from loans and leases to real estate owned                              |   |                     | 194      |   |   |   | 451 |   |
| See accompanying notes to unaudited consolidated financial statements.            |   |                     |     |   |   |

----

DNB 

|                                 |   |          |    |   | June 30, 2009 |   |    |             |   |
|--------------------------------------|--------|---------------|---------|--------|--------------------|--------|---------|------------------|--------|
| (Dollars in thousands)               |   | AmortizedCost |    |   | UnrealizedGains    |   |    | UnrealizedLosses |   |   | EstimatedFair Value |   |
| Held To Maturity                     |   |          |    |   |               |   |    |             |   |   |   |   |
| US agency mortgage-backed securities |   | $             | 19,319  |   |               | $      | 308     |             |   | $ | — |   |   | $ | 19,627 |   |
| Collateralized mortgage obligations  |   |          | 4,304   |   |               |   | 8       |             |   |   | (101 | ) |   |   | 4,211 |   |
| State and municipal tax-exempt bonds |   |          | 5,473   |   |               |   | 68      |             |   |   | — |   |   |   | 5,541 |   |
| State and municipal taxable bonds    |   |          | 22,135  |   |               |   | 306     |             |   |   | (1,404 | ) |   |   | 21,037 |   |
| Total                                |   | $             | 51,231  |   |               | $      | 690     |             |   | $ | (1,505 | ) |   | $ | 50,416 |   |
| Available For Sale                   |   |          |    |   |               |   |    |             |   |   |   |   |   |   |   |   |
| US Government agency obligations     |   | $             | 30,036  |   |               | $      | 90      |             |   | $ | (4 | ) |   | $ | 30,122 |   |
| US agency mortgage-backed securities |   |          | 84,723  |   |               |   | 4       |             |   |   | (591 | ) |   |   | 84,135 |   |
| Collateralized mortgage obligations  |   |          | 10,646  |   |               |   | — |             |   |   | (183 | ) |   |   | 10,463 |   |
| Corporate bonds                      |   |          | 22,565  |   |               |   | 61      |             |   |   | (1,362 | ) |   |   | 21,264 |   |
| Equity securities                    |   |          | 32      |   |               |   | — |             |   |   | (20 | ) |   |   | 12 |   |
| Total                                |   | $             | 148,002 |   |               | $      | 155     |             |   | $ | (2,160 | ) |   | $ | 145,996 |   |

|                                 |   |          |   |   | December 31, 2008 |   |    |             |   |
|--------------------------------------|--------|---------------|--------|--------|------------------------|--------|---------|------------------|--------|
| (Dollars in thousands)               |   | AmortizedCost |   |   | UnrealizedGains        |   |    | UnrealizedLosses |   |   | EstimatedFair Value |   |
| Held To Maturity                     |   |          |   |   |                   |   |    |             |   |   |   |   |
| US agency mortgage-backed securities |   | $             | 27,884 |   |                   | $      | 447     |             |   | $ | (2 | ) |   | $ | 28,329 |   |
| Collateralized mortgage obligations  |   |          | 4,962  |   |                   |   | 1       |             |   |   | (111 | ) |   |   | 4,852 |   |
| State and municipal tax-exempt bonds |   |          | 4,513  |   |                   |   | 50      |             |   |   | (1 | ) |   |   | 4,562 |   |
| State and municipal taxable bonds    |   |          | 22,036 |   |                   |   | 78      |             |   |   | (1,332 | ) |   |   | 20,782 |   |
| Total                                |   | $             | 59,395 |   |                   | $      | 576     |             |   | $ | (1,446 | ) |   | $ | 58,525 |   |
| Available For Sale                   |   |          |   |   |                   |   |    |             |   |   |   |   |   |   |   |   |
| US Government agency obligations     |   | $             | 6,075  |   |                   | $      | 51      |             |   | $ | — |   |   | $ | 6,126 |   |
| US agency mortgage-backed securities |   |          | 32,063 |   |                   |   | 410     |             |   |   | (94 | ) |   |   | 32,379 |   |
| Collateralized mortgage obligations  |   |          | 5,011  |   |                   |   | 94      |             |   |   | — |   |   |   | 5,105 |   |
| Corporate bonds                      |   |          | 18,084 |   |                   |   | 300     |             |   |   | (1,349 | ) |   |   | 17,035 |   |
| Equity securities                    |   |          | 32     |   |                   |   | — |             |   |   | (11 | ) |   |   | 21 |   |
| Total                                |   | $             | 61,265 |   |                   | $      | 855     |             |   | $ | (1,454 | ) |   | $ | 60,666 |   |

----

|                                 |   | June 30, 2009   |    |
|--------------------------------------|--------|-----------------|---------|
| (Dollars in thousands)               |   | TotalFair Value |    |   | TotalUnrealizedLoss |   |   | Fair valueImpairedLess Than12 Months |   |   | UnrealizedLossLess Than12 Months |   |   | Fair valueImpairedMore Than12 Months |   |   | UnrealizedLossMore Than12 Months |   |
| Held To Maturity                     |   |            |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Collateralized mortgage obligations  |   | $               | 3,419   |   |   | $ | (101 | ) |   | $ | 1,365 |   |   | $ | (22 | ) |   | $ | 2,054 |   |   | $ | (79 | ) |
| State and municipal tax-exempt       |   |            | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| State and municipal taxable          |   |            | 10,773  |   |   |   | (1,404 | ) |   |   | 5,872 |   |   |   | (667 | ) |   |   | 4,900 |   |   |   | (737 | ) |
| US agency mortgage-backed securities |   |            | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Total                                |   | $               | 14,192  |   |   | $ | (1,505 | ) |   | $ | 7,237 |   |   | $ | (689 | ) |   | $ | 6,954 |   |   | $ | (816 | ) |
|                                 |   |            |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Available For Sale                   |   |            |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| US Government agency obligations     |   | $               | 6,230   |   |   | $ | (4 | ) |   | $ | 6,230 |   |   | $ | (4 | ) |   | $ | — |   |   | $ | — |   |
| Corporate Bonds                      |   |            | 18,603  |   |   |   | (1,362 | ) |   |   | 11,331 |   |   |   | (516 | ) |   |   | 7,272 |   |   |   | (847 | ) |
| US agency mortgage-backed securities |   |            | 65,356  |   |   |   | (591 | ) |   |   | 65,356 |   |   |   | (591 | ) |   |   | — |   |   |   | — |   |
| Collateralized mortgage obligations  |   |            | 10,463  |   |   |   | (183 | ) |   |   | 10,463 |   |   |   | (183 | ) |   |   | — |   |   |   | — |   |
| Equity securities                    |   |            | 12      |   |   |   | (20 | ) |   |   | — |   |   |   | — |   |   |   | 12 |   |   |   | (20 | ) |
| Total                                |   | $               | 100,664 |   |   | $ | (2,160 | ) |   | $ | 93,380 |   |   | $ | (1,294 | ) |   | $ | 7,284 |   |   | $ | (867 | ) |

|                                 |   | December 31, 2008 |   |
|--------------------------------------|--------|------------------------|--------|
| (Dollars in thousands)               |   | TotalFair Value        |   |   | TotalUnrealizedLoss |   |   | Fair valueImpairedLess Than12 Months |   |   | UnrealizedLossLess Than12 Months |   |   | Fair valueImpairedMore Than12 Months |   |   | UnrealizedLossMore Than12 Months |   |
| Held To Maturity                     |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Collateralized mortgage obligations  |   | $                      | 4,246  |   |   | $ | (111 | ) |   | $ | — |   |   | $ | — |   |   | $ | 4,246 |   |   | $ | (111 | ) |
| State and municipal tax-exempt       |   |                   | 527    |   |   |   | (1 | ) |   |   | 527 |   |   |   | (1 | ) |   |   | — |   |   |   | — |   |
| State and municipal taxable          |   |                   | 13,018 |   |   |   | (1,332 | ) |   |   | 13,018 |   |   |   | (1,332 | ) |   |   | — |   |   |   | — |   |
| US agency mortgage-backed securities |   |                   | 118    |   |   |   | (2 | ) |   |   | 118 |   |   |   | (2 | ) |   |   | — |   |   |   | — |   |
| Total                                |   | $                      | 17,909 |   |   | $ | (1,446 | ) |   | $ | 13,663 |   |   | $ | (1,335 | ) |   | $ | 4,246 |   |   | $ | (111 | ) |
|                                 |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Available For Sale                   |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Corporate Bonds                      |   | $                      | 12,329 |   |   | $ | (1,349 | ) |   | $ | 12,329 |   |   | $ | (1,349 | ) |   | $ | — |   |   | $ | — |   |
| US agency mortgage-backed securities |   |                   | 7,161  |   |   |   | (94 | ) |   |   | 5,482 |   |   |   | (61 | ) |   |   | 1,679 |   |   |   | (33 | ) |
| Equity securities                    |   |                   | 21     |   |   |   | (11 | ) |   |   | — |   |   |   | — |   |   |   | 21 |   |   |   | (11 | ) |
| Total                                |   | $                      | 19,511 |   |   | $ | (1,454 | ) |   | $ | 17,811 |   |   | $ | (1,410 | ) |   | $ | 1,700 |   |   | $ | (44 | ) |

----

|                                   |   | Held to Maturity |    |   | Available for Sale  |   |
|----------------------------------------|--------|------------------|---------|--------|---------------------|--------|
| (Dollars in thousands)                 |   | AmortizedCost    |    |   | EstimatedFair Value |   |   | AmortizedCost |   |   | EstimatedFair Value |   |
| Due in one year or less                |   | $                | 6,213   |   |                | $      | 6,242 |   |   | $ | 5,183 |   |   | $ | 5,203 |   |
| Due after one year through five years  |   |             | 8,311   |   |                |   | 8,422 |   |   |   | 41,610 |   |   |   | 40,723 |   |
| Due after five years through ten years |   |             | 19,400  |   |                |   | 19,617 |   |   |   | 44,039 |   |   |   | 43,511 |   |
| Due after ten years                    |   |             | 17,307  |   |                |   | 16,135 |   |   |   | 57,138 |   |   |   | 56,547 |   |
| No stated maturity                     |   |             | — |   |                |   | — |   |   |   | 32 |   |   |   | 12 |   |
| Total investment securities            |   | $                | 51,231  |   |                | $      | 50,416 |   |   | $ | 148,002 |   |   |   | 145,996 |   |

|                   |   | Six Months Ended June 30 |   |
|------------------------|--------|--------------------------|--------|
| (Dollars in thousands) |   | 2009                     |   |   | 2008 |   |
| Gross realized gains   |   | $                        | 599    |   |   | $ | 737 |   |
| Gross realized losses  |   |                     | 48     |   |   |   | — |   |
| Net realized gain      |   | $                        | 551    |   |   | $ | 737 |   |

----

|                                                                                                       |   | Three Months Ended |    |   | Six Months Ended |   |
|------------------------------------------------------------------------------------------------------------|--------|--------------------|---------|--------|------------------|--------|
|                                                                                                       |   | June 30, 2009      |    |   | June 30, 2009    |   |
| (In thousands, except per-share data)                                                                      |   | Income             |    |   | Shares           |   |   | Amount |   |   | Income |   |   | Shares |   |   | Amount |   |
| Basic EPS                                                                                                  |   |               |    |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (loss) available to common stockholders                                                             |   | $                  | (186    | )      |             |   | 2,603 |   |   | $ | (.07 | ) |   | $ | 195 |   |   |   | 2,603 |   |   | $ | 0.07 |   |
| Effect of potential dilutive common stock equivalents– stock options, restricted shares and warrants |   |               | — |   |             |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Diluted EPS                                                                                                |   |               |    |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (loss) available to common stockholders after assumed conversions                                   |   | $                  | (186    | )      |             |   |  2,603 |   |   | $ | (.07 | ) |   | $ | 195 |   |   |   | 2,603 |   |   | $ | 0.07 |   |

|                                                                                                       |   | Three Months Ended |    |   | Six Months Ended |   |
|------------------------------------------------------------------------------------------------------------|--------|--------------------|---------|--------|------------------|--------|
|                                                                                                       |   | June 30, 2008      |    |   | June 30, 2008    |   |
| (In thousands, except per-share data)                                                                      |   | Income             |    |   | Shares           |   |   | Amount |   |   | Income |   |   | Shares |   |   | Amount |   |
| Basic EPS                                                                                                  |   |               |    |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income available to common stockholders                                                                    |   | $                  | 431     |   |             |   | 2,600 |   |   | $ | 0.17 |   |   | $ | 840 |   |   |   | 2,598 |   |   | $ | 0.32 |   |
| Effect of potential dilutive common stock equivalents– stock options, restricted shares and warrants |   |               | — |   |             |   | 4 |   |   |   | — |   |   |   | — |   |   |   | 4 |   |   |   | — |   |
| Diluted EPS                                                                                                |   |               |    |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income available to common stockholders after assumed conversions                                          |   | $                  | 431     |   |             |   |  2,604 |   |   | $ | 0.17 |   |   | $ | 840 |   |   |   |  2,602 |   |   | $ | 0.32 |   |

|                                                        |   | Three Months Ended |    |   | Three Months Ended |   |
|-------------------------------------------------------------|--------|--------------------|---------|--------|--------------------|--------|
|                                                        |   | June 30, 2009      |    |   | June 30, 2008      |   |
| (Dollars in thousands)                                      |   | Net-of-Tax Amount  |    |   | Net-of-Tax Amount  |   |
| Net (loss) income                                           |   | $                  | (39     | )      |               | $      | 431 |   |
| Other Comprehensive Income (loss):                          |   |               |    |   |               |   |   |   |
| Unrealized holding gains (losses) arising during the period |   |               | — |   |               |   | (3,001 | ) |
| Accretion of discount on AFS to HTM reclassification        |   |               | 12      |   |               |   | — |   |
| Reclassification for gains included in net income (loss)    |   |               | (33     | )      |               |   | (318 | ) |
| Total Comprehensive Loss                                    |   | $                  | (60     | )      |               | $      | (2,888 | ) |
|                                                        |   |               |    |   |               |   |   |   |
|                                                        |   | Six Months Ended   |    |   | Six Months Ended   |   |
|                                                        |   | June 30, 2009      |    |   | June 30, 2008      |   |
| (Dollars in thousands)                                      |   | Net-of-Tax Amount  |    |   | Net-of-Tax Amount  |   |
| Net Income                                                  |   | $                  | 440     |   |               | $      | 840 |   |
| Other Comprehensive Loss:                                   |   |               |    |   |               |   |   |   |
| Unrealized holding losses arising during the period         |   |               | (564    | )      |               |   | (1,640 | ) |
| Accretion of discount on AFS to HTM reclassification        |   |               | 35      |   |               |   | — |   |
| Reclassification for gains included in net income           |   |               | (364    | )      |               |   | (487 | ) |
| Unrealized actuarial losses- pension                        |   |               | — |   |               |   | (169 | ) |
| Total Comprehensive Loss                                    |   | $                  | (453    | )      |               | $      | (1,456 | ) |

----

|                                |   | June 30, |    |   | December 31, |   |
|-------------------------------------|--------|----------|---------|--------|--------------|--------|
| (Dollars in thousands)              |   | 2009     |    |   | 2008         |   |
| Commercial mortgage                 |   | $        | 143,450 |   |         | $      | 138,897 |   |
| Commercial term and lines of credit |   |     | 85,651  |   |         |   | 83,186 |   |
| Consumer                            |   |     | 58,428  |   |         |   | 63,400 |   |
| Residential mortgage                |   |     | 40,844  |   |         |   | 44,052 |   |
| Commercial leases                   |   |     | 4,778   |   |         |   | 6,919 |   |
| Gross loans and leases              |   | $        | 333,151 |   |         | $      | 336,454 |   |
| Allowance for credit losses         |   |     | (4,920  | )      |         |   | (4,586 | ) |
| Net loans and leases                |   | $        | 328,231 |   |         | $      | 331,868 |   |

----

----

|                        | Number      | Weighted Average |
|-----------------------------|-------------|------------------|
|                        | Outstanding | Exercise Price   |
| Outstanding January 1, 2009 | 191,247     |             | $19.03 |
| Granted                     | –     |             | – |
| Exercised                   | –     |             | – |
| Expired                     | (19,229)    |             |  (17.40) |
| Forfeited                   | (2,515)     |             |  (20.24) |
| Outstanding June 30, 2009   | 169,503     |             | $19.19 |

----

|                        |   | Number      |    |   | Weighted Average |   |
|-----------------------------|--------|-------------|---------|--------|------------------|--------|
|                        |   | Outstanding |    |   | Exercise Price   |   |
| Outstanding January 1, 2008 |   |        | 243,320 |   |             | $      | 19.36 |   |
| Granted                     |   |        | – |   |             |   | – |   |
| Exercised                   |   |        | – |   |             |   | – |   |
| Expired                     |   |        | (29,221 | )      |             |   | (21.64 | ) |
| Forfeited                   |   |        | (565    | )      |             |   | (20.21 | ) |
| Outstanding June 30, 2008   |   |        | 213,534 |   |             | $      | 19.04 |   |

|            |        |   | June 30, 2009 |
|-----------------|-------------|--------|---------------|
| Range of        |        |   | Number        |   |   | Weighted Average |   |   |
| Exercise Prices |        |   | Outstanding   |   |   | Exercise Price |   | Remaining Contractual Life |
| $               | 9.23-10.99  |   |          |   | 9,419 |   |   | $ | 9.23 |   | 1.00 years |
|            | 11.00-13.99 |   |          |   | 9,414 |   |   |   | 11.16 |   | 2.00 years |
|            | 14.00-19.99 |   |          |   | 82,805 |   |   |   | 17.44 |   | 5.48 years |
|            | 20.00-22.99 |   |          |   | 19,824 |   |   |   | 22.78 |   | 5.48 years |
|            | 23.00-24.27 |   |          |   | 48,041 |   |   |   | 24.27 |   | 5.80 years |
| Total           |        |   |          | 169,503 |   |   | $ | 19.19 |   | 5.13 years |
| Intrinsic value |        |   | $             | — |   |   |   |   |   |   |

|            |        |   | June 30, 2008 |
|-----------------|-------------|--------|---------------|
| Range of        |        |   | Number        |   |   | Weighted Average |
| Exercise Prices |        |   | Outstanding   |   |   | Exercise Price |   | Remaining Contractual Life |
| $               | 9.23-10.99  |   |          |   | 9,419 |   |   | $ | 9.23 |   | 2.00 years |
|            | 11.00-13.99 |   |          |   | 9,414 |   |   |   | 11.16 |   | 3.00 years |
|            | 14.00-16.99 |   |          |   | 22,985 |   |   |   | 16.83 |   | 4.00 years |
|            | 17.00-19.99 |   |          |   | 93,866 |   |   |   | 17.56 |   | 5.73 years |
|            | 20.00-22.99 |   |          |   | 29,809 |   |   |   | 22.59 |   | 6.59 years |
|            | 23.00-24.27 |   |          |   | 48,041 |   |   |   | 24.27 |   | 6.80 years |
| Total           |        |   |          | 213,534 |   |   | $ | 19.04 |   | 5.62 years |
| Intrinsic value |        |   | $             | 71,662 |   |   |   |   |   |   |

----

|                              | Shares                                    |
|-----------------------------------|-------------------------------------------|
| Outstanding - January 1, 2009     | 24,574                                    |
| Granted                           | –                                   |
| Forfeited                         |       (473) |
| Outstanding – June 30, 2009 | 24,101                                    |

|                              | Shares   |
|-----------------------------------|----------|
| Outstanding - January 1, 2008     | 30,103   |
| Granted                           | –  |
| Vested shares                     | (13,087) |
| Forfeited                         | (1,292)  |
| Outstanding – June 30, 2008 | 15,724   |

----

|                                                        |   | June 30, 2009 |    |
|-------------------------------------------------------------|--------|---------------|---------|
| (Dollars in thousands)                                      |   | Level 1  |    |   | Level 2 |   |   | Level 3 |   |   | Assets atFair Value |   |
| Assets Measured at Fair Value on a Recurring Basis          |   |          |    |   |   |   |   |   |   |   |   |   |
| Securities available for sale                               |   | $             | 12      |   |   | $ | 145,984 |   |   | $ | — |   |   | $ | 145,996 |   |
| Total assets measured at fair value on a recurring basis    |   | $             | 12      |   |   | $ | 145,984 |   |   | $ | — |   |   | $ | 145,996 |   |
| Assets Measured at Fair Value on a Nonrecurring Basis       |   |          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Impaired loans                                              |   | $             | — |   |   | $ | — |   |   | $ | 2,384 |   |   | $ | 2,384 |   |
| OREO & other repossessed property                  |   |          | — |   |   |   | — |   |   |   | 4,750 |   |   |   | 4,750 |   |
| Total assets measured at fair value on a nonrecurring basis |   | $             | — |   |   | $ | — |   |   | $ | 7,134 |   |   | $ | 7,134 |   |

|                                                        |   | December 31, 2008 |    |
|-------------------------------------------------------------|--------|------------------------|---------|
| (Dollars in thousands)                                      |   | Level 1           |    |   | Level 2 |   |   | Level 3 |   |   | Assets atFair Value |   |
| Assets Measured at Fair Value on a Recurring Basis          |   |                   |    |   |   |   |   |   |   |   |   |   |
| Securities available for sale                               |   | $                      | 21      |   |   | $ | 60,645 |   |   | $ | — |   |   | $ | 60,666 |   |
| Total assets measured at fair value on a recurring basis    |   | $                      | 21      |   |   | $ | 60,645 |   |   | $ | — |   |   | $ | 60,666 |   |
| Assets Measured at Fair Value on a Nonrecurring Basis       |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Impaired loans                                              |   | $                      | — |   |   | $ | — |   |   | $ | 1,043 |   |   | $ | 1,043 |   |
| OREO & other repossessed property                  |   |                   | — |   |   |   | — |   |   |   | 4,997 |   |   |   | 4,997 |   |
| Total assets measured at fair value on a nonrecurring basis |   | $                      | — |   |   | $ | — |   |   | $ | 6,040 |   |   | $ | 6,040 |   |

----

|                           |   | June 30, 2009  |    |   | December 31, 2008  |   |
|--------------------------------|--------|----------------|---------|--------|--------------------|--------|
| (Dollars in thousands)         |   | CarryingAmount |    |   | EstimatedFairValue |   |   | CarryingAmount |   |   | EstimatedFairValue |   |
| Financial assets               |   |           |    |   |               |   |   |   |   |   |   |   |
| Cash and cash equivalents      |   | $              | 50,590  |   |               | $      | 50,590 |   |   | $ | 48,118 |   |   | $ | 48,118 |   |
| AFS Investment securities      |   |           | 145,996 |   |               |   | 145,996 |   |   |   | 60,666 |   |   |   | 60,666 |   |
| HTM Investment securities      |   |           | 51,231  |   |               |   | 50,416 |   |   |   | 59,395 |   |   |   | 58,525 |   |
| Loans and leases, gross        |   |           | 333,151 |   |               |   | 329,852 |   |   |   | 336,454 |   |   |   | 334,550 |   |
| Accrued interest receivable    |   |           | 2,555   |   |               |   | 2,555 |   |   |   | 2,127 |   |   |   | 2,127 |   |
| Financial liabilities          |   |           |    |   |               |   |   |   |   |   |   |   |   |   |   |   |
| Deposits                       |   |           | 450,761 |   |               |   | 440,841 |   |   |   | 408,470 |   |   |   | 405,414 |   |
| Borrowings                     |   |           | 104,614 |   |               |   | 108,101 |   |   |   | 80,844 |   |   |   | 86,108 |   |
| Junior subordinated debentures |   |           | 9,279   |   |               |   | 3,495 |   |   |   | 9,279 |   |   |   | 5,158 |   |
| Accrued interest payable       |   |           | 803     |   |               |   | 803 |   |   |   | 1,154 |   |   |   | 1,154 |   |
| Off-balance sheet instruments  |   |           | – |   |               |   | – |   |   |   | – |   |   |   | – |   |

----

ITEM 

----

| ·   | Focus on penetrating markets and allowing existing locations to maximize profitability |
|--------------------|----------------------------------------------------------------------------------------|

| ·   | Improve earnings by allowing revenues to catch up to the investments made over the past five years in people, infrastructure and branch expansion |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Implement a formal training program that will emphasize product knowledge, sales skills, people skills and technical knowledge to promote customer satisfaction |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Grow loans and diversify the mix |
|--------------------|----------------------------------|

| ·   | Reduce long-term borrowings |
|--------------------|-----------------------------|

| ·   | Focus on profitable customer segments |
|--------------------|---------------------------------------|

| ·   | Grow and diversify non-interest income |
|--------------------|----------------------------------------|

| ·   | Focus on reducing DNB’s cost of funds by changing DNB’s mix of deposits |
|--------------------|-------------------------------------------------------------------------------------|

| ·   | Focus on cost containment and improving operational efficiencies |
|--------------------|------------------------------------------------------------------|

----

----

|                           |   |          |   |    |   |   |   |   |   |   |   |
|--------------------------------|--------|---------------|--------|---------|--------|--------|--------|--------|--------|--------|--------|
|                           |   | Risk Category |   |
|                           |   | I             |   |    |   |   |   |   |   |
|                           |   | Minimum       |   | Maximum |   | II     |   | III    |   | IV     |   |
|                           |   |
| Annual rates (in basis points) |   | 12            |   | 16      |   | 22     |   | 32     |   | 45     |   |
|                           |   |

|                         |   |          |   |          |   |          |   |          |
|------------------------------|--------|---------------|--------|---------------|--------|---------------|--------|---------------|
|                         |   | Risk Category |
|                         |   | I             |   | II            |   | III           |   | IV            |
|                         |
| Initial base assessment rate |   | 12 to 16      |   | 22            |   | 32            |   | 45            |
| Unsecured debt adjustment    |   | –5 to 0 |   | –5 to 0 |   | –5 to 0 |   | –5 to 0 |
| Secured liability adjustment |   | 0 to 8        |   | 0 to 11       |   | 0 to 16       |   | 0 to 22.5     |
| Brokered deposit adjustment  |   | —       |   | 0 to 10       |   | 0 to 10       |   | 0 to 10       |
| Total base assessment rate   |   | 7 to 24       |   | 17 to 43      |   | 27 to 58      |   | 40 to 77.5    |
|                         |

----

----

----

----

|   (Dollars in thousands) |   | Six Months Ended June 30,2009 |   |   | Year EndedDecember 31,2008 |   |   | Six Months Ended June 30,2008 |   |
|------------------------------------|--------|-------------------------------|--------|--------|----------------------------|--------|--------|-------------------------------|--------|
| Beginning balance                  |   | $                             | 4,586  |   |                       | $      | 3,891  |                          |   |   | 3,891 |   |
| Provisions                         |   |                          | 400    |   |                       |   | 2,018  |                          |   |   | 514 |   |
| Charge-offs                        |   |                          | (90    | )      |                       |   | (1,401 | )                             |   |   | (230 | ) |
| Recoveries                         |   |                          | 24     |   |                       |   | 78     |                          |   |   | 47 |   |
| Ending balance                     |   | $                             | 4,920  |   |                       | $      | 4,586  |                          |   | $ | 4,222 |   |

----

| Non-Performing Assets                 |   |               |    |   |              |   |    |               |   |
|---------------------------------------|--------|--------------------|---------|--------|-------------------|--------|---------|--------------------|--------|
| (Dollars in thousands)                |   | June 30, 2009 |    |   | December 31, 2008 |   |    | June 30, 2008 |   |
| Loans and leases:                     |   |               |    |   |              |   |    |               |   |
| Non-accrual                           |   | $                  | 7,560   |   |              | $      | 1,825   |               |   | $ | 6,973 |   |
| 90 days past due and still accruing   |   |               | 651     |   |              |   | 900     |               |   |   | 672 |   |
| Troubled debt restructurings          |   |               | — |   |              |   | — |               |   |   | — |   |
| Total non-performing loans and leases |   |               | 8,211   |   |              |   | 2,725   |               |   |   | 7,645 |   |
| OREO and other repossessed property   |   |               | 4,751   |   |              |   | 4,997   |               |   |   | 451 |   |
| Total non-performing assets           |   | $                  | 12,962  |   |              | $      | 7,722   |               |   | $ | 8,096 |   |

----

|                                  |   | June 30,2009 |   | December 31, 2008 |   | June 30,2008 |
|---------------------------------------|--------|--------------|--------|-------------------|--------|--------------|
| Asset quality ratios:                 |   |         |   |              |   |         |   |   |   |
| Non-performing loans to total loans   |   |         | 2.46   | %                 |   |         | 0.81 | % |   |   | 2.40 | % |
| Non-performing assets to total assets |   |         | 2.13   |              |   |         | 1.45 |   |   |   | 1.54 |   |
| Allowance for credit losses to:       |   |         |   |              |   |         |   |   |   |   |   |   |
| Total loans and leases                |   |         | 1.48   |              |   |         | 1.36 |   |   |   | 1.32 |   |
| Non-performing loans and leases       |   |         | 59.92  |              |   |         | 168.29 |   |   |   | 55.22 |   |

|                                       |   | Three Months Ended |   |   | Year Ended       |   |   | Three Months Ended |   |
|--------------------------------------------|--------|--------------------|--------|--------|------------------|--------|--------|--------------------|--------|
|  (Dollars in thousands)               |   | March 31,2009      |   |   | December 31,2008 |   |   | June 30,2008       |   |
| Interest income which would have been      |   |               |   |   |             |   |   |               |   |
| recorded under original terms              |   | $                  | 209    |   |             | $      | 121    |               |   | $ | 239 |   |
| Interest income recorded during the period |   |               | (29    | )      |             |   | (58    | )                  |   |   | (29 | ) |
| Net impact on interest income              |   | $                  | 180    |   |             | $      | 63     |               |   | $ | 210 |   |

|                          |   | Six Months Ended |   |   | Year Ended             |   |   | Six Months Ended |   |
|-------------------------------|--------|------------------|--------|--------|------------------------|--------|--------|------------------|--------|
|  (Dollars in thousands)  |   | June 30,2009     |   |   | December 31, 2008 |   |   | June 30,2008     |   |
| Total recorded investment     |   | $                | 7,560  |   |                   | $      | 1,163  |             |   | $ | 9,026 |   |
| Average recorded investment   |   |             | 6,715  |   |                   |   | 6,236  |             |   |   | 8,979 |   |
| Specific allowance allocation |   |             | 296    |   |                   |   | 120    |             |   |   | 606 |   |
| Total cash collected          |   |             | 468    |   |                   |   | 313    |             |   |   | 313 |   |
| Interest income recorded      |   |             | 40     |   |                   |   | 108    |             |   |   | 108 |   |

----

|                      |   |   |   | For Capital       |   | To Be Well Capitalized Under Prompt Corrective |
|---------------------------|--------|--------|--------|-------------------|--------|------------------------------------------------|
|                      |   | Actual |   | Adequacy Purposes |   | Action Provisions                              |
| (Dollars in thousands)    |   | Amount |   |              | Ratio  |                                           | Amount |   |   | Ratio |   | Amount |   |   | Ratio |
| DNB Financial Corporation |   |   |   |              |   |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
|                      |   |   |   |              |   |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| June 30, 2009:            |   |   |   |              |   |                                           |   |   |   |   |   |   |   |   |   |   |   |   |
| Total risk-based capital  |   | $      | 57,361 |              |   |                                           | 14.48 | % |   | $ | 31,685 |   |   |   | 8.00 | % |   |   | N/A |   |   |   | N/A |   |
| Tier 1 capital            |   |   | 52,457 |              |   |                                           | 13.24 |   |   |   | 15,843 |   |   |   | 4.00 |   |   |   | N/A |   |   |   | N/A |   |
| Tier 1 (leverage) capital |   |   | 52,457 |              |   |                                           | 8.99 |   |   |   | 23,346 |   |   |   | 4.00 |   |   |   | N/A |   |   |   | N/A |   |
| December 31, 2008:        |   |   |   |              |   |                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total risk-based capital  |   | $      | 45,516 |              |   |                                           | 12.02 | % |   | $ | 30,306 |   |   |   | 8.00 | % |   |   | N/A |   |   |   | N/A |   |
| Tier 1 capital            |   |   | 40,802 |              |   |                                           | 10.77 |   |   |   | 15,153 |   |   |   | 4.00 |   |   |   | N/A |   |   |   | N/A |   |
| Tier 1 (leverage) capital |   |   | 40,802 |              |   |                                           | 7.46 |   |   |   | 21,882 |   |   |   | 4.00 |   |   |   | N/A |   |   |   | N/A |   |
|                      |   |   |   |              |   |                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| DNB First, N.A.           |   |   |   |              |   |                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                      |   |   |   |              |   |                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| June 30, 2009:            |   |   |   |              |   |                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total risk-based capital  |   | $      | 55,808 |              |   |                                           | 14.11 | % |   | $ | 31,632 |   |   |   | 8.00 | % |   | $ | 39,540 |   |   |   | 10.00 | % |
| Tier 1 capital            |   |   | 50,904 |              |   |                                           | 12.87 |   |   |   | 15,816 |   |   |   | 4.00 |   |   |   | 23,724 |   |   |   | 6.00 |   |
| Tier 1 (leverage) capital |   |   | 50,904 |              |   |                                           | 8.73 |   |   |   | 23,318 |   |   |   | 4.00 |   |   |   | 29,147 |   |   |   | 5.00 |   |
| December 31, 2008:        |   |   |   |              |   |                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total risk-based capital  |   | $      | 45,378 |              |   |                                           | 12.00 | % |   | $ | 30,257 |   |   |   | 8.00 | % |   | $ | 37,822 |   |   |   | 10.00 | % |
| Tier 1 capital            |   |   | 40,654 |              |   |                                           | 10.75 |   |   |   | 15,129 |   |   |   | 4.00 |   |   |   | 22,693 |   |   |   | 6.00 |   |
| Tier 1 (leverage) capital |   |   | 40,654 |              |   |                                           | 7.44 |   |   |   | 21,862 |   |   |   | 4.00 |   |   |   | 27,328 |   |   |   | 5.00 |   |

----

ITEM 

| (Dollars in thousands)                 | June 30, 2009 |   | December 31, 2008 |   |
|----------------------------------------|---------------|--------|-------------------|--------|
|                                   |          |   |              |   |
| Change in rates                        | Flat          |   | -200bp            |   | +200bp |   | Flat |   | -200bp |   | +200bp |   |
|  EVE                              | 48,214        |   | $51,103           |   | $38,365 |   | $29,196 |   | $30,554 |   | $25,831 |   |
|  Change                           |          |   | 2,889             |   |  (9,849 | ) |   |   | 1,358 |   | (3,365 | ) |
|  Change as a percent of assets    |          |   | .5%               |   | (1.6% | ) |   |   | 0.3% |   | (0.6% | ) |
|  Change as a percent of PV equity |          |   | 6.0%              |   | (20.4% | ) |   |   | 4.7% |   | (11.5% | ) |

ITEM 

----

ITEM 

ITEM 

ITEM 

| Period                               |   | Total NumberOf Shares Purchased |   | AveragePrice PaidPer Share |   | Total Number ofShares Purchasedas Part of PubliclyAnnounced Plansor Programs |   | Maximum Numberof Shares that MayYet Be PurchasedUnder the Plans orPrograms (a) |
|--------------------------------------|--------|--------------------------------------|--------|----------------------------|--------|----------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------|
| April 1, 2009 – April 30, 2009 |   | —                              |   | $   — |   | —                                                                                                              |   | 63,216                                                                                                                           |
| May 1, 2009 – May 31, 2009     |   | 100                                  |   | 9.26                       |   | 100                                                                                                                  |   | 63,116                                                                                                                           |
| June 1, 2009 – June 30, 2009   |   | —                              |   | —                    |   | —                                                                                                              |   | 63,116                                                                                                                           |
| Total                                |   | 100                                  |   | $9.26                      |   | 100                                                                                                                  |   |                                                                                                                             |

ITEM 

ITEM 

|   | (a) | The Corporation held its Annual Meeting of Shareholders on May 05, 2009 for the purpose of considering and acting upon a proposal to elect three Class B directors to serve a three year term. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | The directors elected and the numbers of votes cast for or withheld with respect to each were: |
|--------|-----|------------------------------------------------------------------------------------------------|

|               | For       | Withheld |
|--------------------|-----------|----------|
| Thomas A. Fillippo | 1,792,007 | 179,839  |
| James J. Koegel    | 1,834,460 | 137,386  |
| Eli Silberman      | 1,832,718 | 139,128  |

|   | (c) | The following other matters were voted on at the meeting: |
|--------|-----|-----------------------------------------------------------|

|   | (1) | A motion to approve an amendment to the Incentive Equity and Deferred Compensation Plan to limit the number of shares of common stock available for issuance under the Plan was voted as follows: |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | For:  1,423,281 | Against: 248,587 | Abstain:  14,817 |
|--------|---------------------------|------------------|----------------------------|

----

| (2)   | A motion to approve an advisory (non-binding) resolution concerning the Corporation’s executive compensation, was voted as follows: |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------|

|   | For:  1,664,557 | Against:  288,311 | Abstain:  18,978 |
|--------|---------------------------|-----------------------------|----------------------------|

| (3)   | The motion to ratify the appointment of KPMG LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2009 was voted on as follows: |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | For:  1,916,869 | Against:  41,543 | Abstain:  13,434 |
|--------|---------------------------|----------------------------|----------------------------|

ITEM 

ITEM 

----

Pursuant 

|            |   | DNB FINANCIAL CORPORATION                                            |
|-----------------|--------|----------------------------------------------------------------------|
|            |   |                                                                 |
| August 14, 2009 | BY:    | /s/ William S. Latoff                                                |
|            |   | William S. Latoff, Chairman of theBoard and Chief Executive Officer  |
|            |   |                                                                 |
|            |   |                                                                 |
|            |   |                                                                 |
| August 14, 2009 | BY:    | /s/ Gerald F. Sopp                                                   |
|            |   | Gerald F. Sopp, Chief Financial Officer and Executive Vice President |
|            |   |                                                                 |
|            |   |                                                                 |

----

Index 

| Exhibit No.Under Item 601of Regulation S-K | Description of Exhibit and Filing Information |
|------------------------------------------------------|-----------------------------------------------|
| 3                                                    | (i)                                           | Amended and Restated Articles of Incorporation, as amended effective December 8, 2008, filed March 31, 2009 as item 3(i) to Form 10-K for the fiscal year-ended December 31, 2008 (No. 0-16667) and incorporated herein by reference. |
|                                                 | (ii)                                          | Bylaws of the Registrant as amended December 8, 2008, filed March 31, 2009 as item 3(ii) to Form 10-K for the fiscal year-ended December 31, 2008 (No. 0-16667) and incorporated herein by reference. |
| 4                                                    |                                          | Registrant has certain debt obligations outstanding, for none of which do the instruments defining holders rights authorize an amount of securities in excess of 10% of the total assets of the Registrant and its subsidiaries on a consolidated basis. Registrant agrees to furnish copies of such agreements to the Commission on request. |
| 10                                                   | (a)*                                          | Amended and Restated Change of Control Agreements dated December 20, 2006 between DNB Financial Corporation and DNB First, N.A. and the following executive officers, each in the form filed March 26, 2007 as item 10(a) to Form 10-K for the fiscal year-ended December 31, 2006 (No. 0-16667) and incorporated hereinby reference: Bruce E. Moroney, C. Tomlinson Kline III, and Richard J. Hartmann. |
|                                                 | (b)**                                         | 1995 Stock Option Plan of DNB Financial Corporation (as amended and restated, effective as of April 27, 2004), filed on March 29, 2004 as Appendix A to Registrant’s Proxy Statement for its Annual Meeting of Stockholders held April 27, 2004, and incorporated herein by reference. |
|                                                 | (c)*                                          | Form of Change of Control Agreements, as amended November 10, 2003, filed on November 14, 2003 as Item 10(e) to Form 8-K (No. 0-16667) and incorporated herein by reference between DNB Financial Corporation and DNB First, N.A. and each of the following Directors: (i) dated November 10, 2005 with James H.Thornton, James J. Koegel and Eli Silberman, and (ii) dated February 23, 2005 with Mildred C. Joyner, and dated February 22, 2006 with Thomas A. Fillippo. On April 17, 2009, the Registrant approved agreements with each non-employee director to terminate his or her Change of Control Agreement. |
|                                                 | (d)**                                         | DNB Financial Corporation Incentive Equity and Deferred Compensation Plan filed March 10, 2005 as item 10(i) to Form 10-K for the fiscal year-ended December 31, 2004 (No. 0-16667) and incorporated herein by reference. |
|                                                 | (e)*                                          | Amended and Restated Change of Control Agreement among DNB Financial Corporation, DNB First, N.A. and William S. Latoff, dated December 20, 2006, filed March 26, 2007 as item 10(e) to Form 10-K for the fiscal year-ended December 31, 2006 (No. 0-16667) and incorporated herein by reference. |
|                                                 | (f)*                                          | Agreement of Lease dated February 10, 2005 between Headwaters Associates, a Pennsylvania general partnership, as Lessor, and DNB First, National Association as Lessee for a portion of premises at 2 North Church Street, West Chester, Pennsylvania, filed March 10, 2005 as Item 10(l) to Form 10-K for the fiscal year endedDecember 31, 2004 (No. 0-16667) and incorporated herein by reference, as amended by Addendum to Agreement of Lease dated as of November 15, 2005, filed March 23, 2006 as Item 10(l) to Form 10-K for the fiscal year ended December 31, 2005 (No. 0-16667) and incorporated herein by reference, and as further amended by Second Addendum to Agreement of Lease dated as of May 25, 2006, filed August 14, 2006 as Item 10(l) to Form 10-Q for the fiscal quarter endedJune 30, 2006 (No. 0-16667) and incorporated herein by reference. |
|                                                 | (g)                                           | Marketing Services Agreement between TSG, Inc., a Pennsylvania business corporation (the “Service Provider”) for which Eli Silberman, a Director of Registrant, is the President and owner dated December 17, 2008, filed March 31, 2009 as item 10(g) to Form 10-K for the fiscal year-ended December 31,2008 (No. 0-16667) and incorporated herein by reference. |
|                                                 | (h)**                                         | Form of Stock Option Agreement for grants prior to 2005 under the Registrant’s Stock Option Plan, filed May 11, 2005 as Item 10(n) to Form 10-Q for the fiscal quarter ended March 31, 2005 (No. 0-16667) and incorporated herein by reference. |
|                                                 | (i)**                                         | Form of Nonqualified Stock Option Agreement for April 18, 2005 and subsequent grants under the Stock Option Plan, filed May 11, 2005 as Item 10(o) to Form 10-Q for the fiscal quarter ended March 31, 2005 (No. 0-16667) and incorporated herein by reference. |

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|   | (j)    | Agreement of Sale dated June 1, 2005 between DNB First, National Association (the “Bank”), as seller, and Papermill Brandywine Company, LLC, a Pennsylvania limited liability company, as buyer (“Buyer”) with respect to the sale of the Bank’s operations center and an adjunct administrative office (the“Property”) and accompanying (i) Agreement of Lease between the Buyer as landlord and the Bank as tenant, pursuant to which the Property will be leased back to the Bank, and (ii) Parking Easement Agreement to provide cross easements with respect to the Property, the Buyer’s other adjoining property and the Bank’s other adjoining property, filed August 15, 2005 as Item 10(p) to Form 10-Q for the fiscal quarter ended June 30, 2005 (No. 0-16667) and incorporatedherein by reference. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | (k)    | Agreement of Lease dated November 18, 2005 between Papermill Brandywine Company, LLC, a Pennsylvania limited liability company (“Papermill”), as Lessor, and DNB First, National Association as Lessee for the banks operations center and adjunct administrative office, filed March 23, 2006 as Item 10(q) to Form 10-Kfor the fiscal year ended December 31, 2005 (No. 0-16667) and incorporated herein by reference.                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|   | (l)*   | Amended and Restated Change of Control Agreement among DNB Financial Corporation, DNB First, N.A. and William J. Hieb, filed May 15, 2007 as Item 10(l) to Form 10-Q for the fiscal quarter ended March 31, 2007 (No. 0-16667) and incorporated herein by reference.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|   | (m)**  | Form of Nonqualified Stock Option Agreement for grants on and after December 22, 2005 under the Stock Option Plan, filed March 23, 2006 as Item 10(s) to Form 10-K for the fiscal year ended December 31, 2005 (No. 0-16667) and incorporated herein by reference.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|   | (n)*   | Deferred Compensation Plan For Directors of DNB Financial Corporation (adopted effective October 1, 2006), filed November 14, 2006 as Item 10(s) to Form 10-Q for the fiscal quarter ended September 30, 2006 (No. 0-16667) and incorporated herein by reference.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|   | (o)*   | DNB Financial Corporation Deferred Compensation Plan (adopted effective October 1, 2006), filed November 14, 2006 as Item 10(t) to Form 10-Q for the fiscal quarter ended September 30, 2006 (No. 0-16667) and incorporated herein by reference.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|   | (p)*   | Trust Agreement, effective as of October 1, 2006, between DNB Financial Corporation and DNB First, National Association (Deferred Compensation Plan), filed November 14, 2006 as Item 10(u) to Form 10-Q for the fiscal quarter ended September 30, 2006 (No. 0-16667) and incorporated herein by reference.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | (q)*   | Change of Control Agreements among DNB Financial Corporation, DNB First, N.A. and each of the following executive officers, each in the form filed March 26, 2007 as item 10(q) to Form 10-K for the fiscal year-ended December 31, 2006 (No. 0-16667) and incorporated herein by reference: Albert J. Melfi, Jr. and GeraldF. Sopp.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|   | (r)*   | DNB Financial Corporation Supplemental Executive Retirement Plan for William S. Latoff as amended and restated effective April 1, 2007, filed May 15, 2007 as Item 10(r) to Form 10-Q for the fiscal quarter ended March 31, 2007 (No. 0-16667) and incorporated herein by reference, as further amended by Amendmentdated December 8, 2008, filed March 31, 2009 as item 3(r) to Form 10-K for the fiscal year-ended December 31, 2008 (No. 0-16667) and incorporated herein by reference.                                                                                                                                                                                                                                                                                                                                                            |
|   | (s)*   | Trust Agreement effective as of December 20, 2006 between DNB Financial Corporation and DNB First, N.A. (William S. Latoff SERP), filed March 26, 2007 as item 10(s) to Form 10-K for the fiscal year-ended December 31, 2006 (No. 0-16667) and incorporated herein by reference, as modified by Agreement to TerminateTrust dated as of April 1, 2007, filed May 15, 2007 as Item 10(s) to Form 10-Q for the fiscal quarter ended March 31, 2007 (No. 0-16667) and incorporated herein by reference.                                                                                                                                                                                                                                                                                                                                                  |
|   | (t)*   | DNB Offer Letter to Albert J. Melfi, Jr., dated November 10, 2006, filed March 26, 2005 as item 10(t) to Form 10-K for the fiscal year-ended December 31, 2006 (No. 0-16667) and incorporated herein by reference.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|   | (u)*   | DNB Offer Letter to Gerald F. Sopp, dated December 20, 2006, filed March 26, 2007 as item 10(u) to Form 10-K for the fiscal year-ended December 31, 2006 (No. 0-16667) and incorporated herein by reference.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | (v)**  | Form of Restricted Stock Award Agreement dated November, 28, 2007, filed March 28, 2008 as item 10(v) to Form 10-K for the fiscal year-ended December 31, 2007 (No. 0-16667) and incorporated herein by reference.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 11     |   | Registrant’s Statement of Computation of Earnings Per Share is incorporated in footnote 3.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 31.1   |   | Rule 13a-14(a)/15d-14 (a) Certification of Chief Executive Officer, filed herewith.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 31.2   |   | Rule 13a-14(a)/15d-14 (a) Certification of Chief Financial Officer, filed herewith.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |

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| 32.1   |   | Section 1350 Certification of Chief Executive Officer, filed herewith.                                                                 |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------|
| 32.2   |   | Section 1350 Certification of Chief Financial Officer, filed herewith.                                                                 |
|   | *      | Management contract or compensatory plan arrangement.                                                                                       |
|   | **     | Shareholder approved compensatory plan pursuant to which the Registrant’s Common Stock may be issued to employees of the Corporation. |
|   |   |                                                                                                                                        |

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