Exhibit 10(j)

                              RETIREMENT AGREEMENT


THIS RETIREMENT AGREEMENT (this "Agreement") is signed on December 10, 2004 by
and among DNB FINANCIAL CORPORATION ("Corporation"), a Pennsylvania business
corporation and bank holding company; DNB FIRST, NATIONAL ASSOCIATION ("Bank"),
a national banking association and wholly-owned subsidiary of the Corporation
(as used in this Agreement, the term "Company" shall refer both individually and
collectively to the Corporation and the Bank); and HENRY F. THORNE, an adult
individual and resident of Delaware County, Pennsylvania ("Executive"). This
Agreement is intended to be effective immediately after 5:00 p.m. prevailing
Eastern time on December 17, 2004 (the "Effective Date") in accordance with
Section 17 of this Agreement.

                                   Background:

A. Executive and Company are parties to that certain Employment Agreement dated
December 31, 1996 (the "1996 Employment Agreement").

B. The 1996 Employment Agreement has been amended once, pursuant to a certain
First Amendment to Employment Agreement dated as of December 23, 2003 (the
"Employment Agreement Amendment"). The 1996 Employment Agreement, as amended by
the Employment Agreement Amendment is sometimes referred to in this Agreement as
the "Executive Employment Agreement."

C. Executive and Company are parties to a certain Retirement and Death Benefit
Agreement dates as of December 23, 2003, providing for certain death benefits,
retirement benefits and other benefits for Executive and his beneficiaries (the
"SERP").

D. Executive holds existing options to purchase 14,889 shares of Corporation
stock pursuant to stock options heretofore granted to Executive from time to
time (the "Existing Stock Options") pursuant to written agreements between
Executive and Company with respect thereto (the "Stock Option Agreements").

E. Executive and Company have agreed upon terms for Executive's retirement on
the Effective Date from his current positions with the Company, and a scheduled
early retirement from his remaining employment with the Company at the close of
business on June 20, 2006 (the "Retirement Date").

F. The Company and the Executive wish to set forth in this document the benefits
to which the Executive is entitled and other agreements applicable to the
Executive.

G. This Agreement terminates and replaces the Executive Employment Agreement
except as provided herein.

NOW, THEREFORE, the parties hereto, intending to be legally bound hereby, agree
as follows:



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1. Press Release. The Executive's retirement will be announced on or immediately
after the Effective Date, in a press release in the form set forth in Exhibit A,
which press release the Executive and Company each hereby approves.

2. Resignations; Appointment; Retirement; No Unemployment Benefits.

(a) Executive hereby irrevocably tenders his resignation as President and Chief
Executive Officer of the Corporation and the Bank and as director of the Bank,
effective on the Effective Date, and the Company hereby accepts such
resignations.

(b) The Corporation hereby confirms to Executive that the Corporation's Board of
Directors has elected Executive to the position of Vice Chairman of the
Corporation, in which capacity the Executive shall continue as an employee of
the Corporation until June 20, 2005.

(c) Executive hereby irrevocably tenders his resignation as director and Vice
Chairman of the Corporation, effective as of the close of business on June 20,
2005, and the Company hereby accepts such resignations.

(d) Company and Executive agree that Executive shall continue to be employed by
the Bank as a Vice President from June 20, 2005 to June 20, 2006.

(e) No break in service shall occur because of the foregoing.

(f) The Executive agrees not to apply for unemployment compensation benefits as
a result of any of the resignations, transactions or other matters referred to
or set forth in this Agreement.

(g) During the remaining period of his employment, Executive shall be
responsible for using his best efforts to assist the Company at its request, in
such manner and at such times as Company may reasonably request, in (A) prior to
June 20, 2005, (i) transitioning to the Company's new leadership, (ii) providing
services to key customers of the Company, and (iii) otherwise pursuing the
Company's mission and business strategies; and (B) from June 20, 2005 to June
20, 2006, assisting with customer and public relations.

3. Termination of Executive Employment Agreement. The Executive Employment
Agreement is hereby terminated absolutely and irrevocably, except for its
requirement that the Company pay the "Severance" thereunder as more fully
described in Section 7 of this Agreement. Company represents to Executive that
(i) no "Change of Control" (as that term is defined in the Executive Employment
Agreement) has occurred and (ii) Company is not entering into this Agreement
with an intent, in whole or part, to avoid an obligation to pay any additional
severance that might be payable under the Executive Employment Agreement upon a
"Change of Control" (as defined therein).

4. Salary and Employment Prior to Retirement Date. Company agrees to pay
Executive salary for his performance of services in his new capacities for the
period from the Effective Date through December 31, 2004 at his current salary,
and from January 1, 2005 through the

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Retirement Date at a rate of $3,000.00 per month, payable at the times and in
the manner salary is generally paid by the Company from time to time. Company
acknowledges and agrees that this salary shall be eligible for matching under
the Company's 401(k) plan and that Executive will be eligible for this match
each quarter during 2005 and the first quarter of 2006, provided he remains
employed with the Company during each respective entire quarter. The foregoing
salary payments shall not be terminated or reduced due to Executive's death or
disability. This agreement to pay salary is conditioned upon Executive's
compliance with the terms of this Agreement. The Company may only terminate its
obligation to pay this salary if Executive resigns from employment with the
Company.

5. Certain Employment Related Benefits. The following agreements to provide
benefits to Executive are conditioned upon Executive's compliance with the terms
of this Agreement.

(a) Executive shall be entitled to a bonus of not less than $20,000 related to
his services in 2004, to be paid by the Company in 2005 at the time that it pays
bonuses to any other executive officer, but in any event payable on or prior to
the Retirement Date. Executive shall not be entitled to any future bonus related
to his services in 2005 or 2006.

(b) During the period of Executive's employment hereafter, the Company will
provide the Executive with an office and telephone, and secretarial services to
assist him in his services for the Company.

(c) Until June 18, 2008, the Company will provide to Executive and his spouse
and the survivor of them, at the Company's expense, health and medical benefits
with coverages and other terms substantially as presently provided to Executive
and his spouse; provided, however, that the Company shall be solely responsible
for determining whether to provide such coverages pursuant to the Company plan
made available to other employees generally, or pursuant to a separate policy or
plan covering Executive and his spouse. In the event that the Company elects to
provide coverage pursuant to the Company's then available plan, such coverage
and other available terms will be subject to any changes in coverage and terms
made generally applicable to the Company's other executive officers during such
periods. In the event that the Company elects to provide such benefits pursuant
to a separate policy or plan covering Executive and his spouse, the Company
shall provide coverage and other terms (to the extent reasonably available)
substantially comparable to those presently provided to Executive and his
spouse. Executive and his spouse shall be solely responsible for any taxes they
may incur by virtue of receiving any such benefits after the Retirement Date.
Executive acknowledges that his right to continuation coverage under the federal
COBRA law shall commence on the Retirement Date.

(d) Use of vacation, vacation carryover if any, and payment for unused vacation
if any, shall be accorded Executive until the Retirement Date on the Company's
standard terms.

(e) The Company will not be obligated to provide any club memberships after June
20, 2005. Any club memberships heretofore provided by the Company shall remain
the property of the Company notwithstanding the name in which the membership is
carried, and any refund of membership fees shall be the property of the Company.

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(f) No modifications have been or are being made to the SERP, which shall remain
in full force and effect hereafter according to its terms.

6. Stock Options.

(a) Executive's retirement on the Retirement Date shall be deemed a retirement
for purposes of the Stock Option Agreements and hence such options may be
exercised at any time during the period originally provided in each Stock Option
Agreement.

(b) Company will not be granting Executive additional Stock Options.

7. Severance. The Company and Executive acknowledge and agree that the
resignations of Executive provided for in this Agreement entitle the Executive,
as of the Effective Date, to severance in the aggregate amount of $207,428 (the
"Severance") under the Executive Employment Agreement, irrespective of the
provisions of this Agreement. The Severance shall be payable on the terms and at
the times provided in the Executive Employment Agreement, unless Executive
elects to receive it in a single lump sum on an earlier date and if he so elects
it shall be payable when he notifies Company of his election. The Severance is
not subject to matching under the Company's 401(k) plan. Executive shall not be
required to mitigate the amount of any payment provided for in this Section by
seeking other employment or otherwise.

8. Adverse Activities.

(a) Prior to June 20, 2008, neither Executive nor any member of his immediate
family will, directly or indirectly, (A) engage or participate in any proxy
contest (whether involving election of directors of the Corporation or
otherwise), (B) speak publicly or assist others (i) against any proposal made by
management of the Company for approval by shareholders, or (ii) in favor of any
proposal made by any shareholder that is not affirmatively supported by
management of the Company, or (C) make any disparaging remarks about the
Corporation, the Bank, any of their corporate affiliates, or any director,
officer, employee or agent of any of them. Nothing in this Agreement shall be
deemed to restrict Executive's right to vote, tender or sell any of his stock in
the Corporation ("Shares") at his discretion; provided, however, that prior to
offering for sale any Shares, Executive shall first notify the Corporation in
writing of his intention to sell and the number of shares and proposed sale
price and give the Corporation or its nominee the right, within two (2) market
days thereafter, to buy those Shares at the mean of the bid and asked price for
the Shares on the most recent trading day prior to the Corporation's receipt of
such notice. If the Corporation or its nominee does not agree to buy those
Shares at such price within two (2) market days after receiving such notice,
Executive shall be free to offer and sell those Shares to others.

(b) The Company shall not make any disparaging remarks about the Executive.

(c) The employees of the Company have been recruited and trained by the Company
at considerable expense to the Company, and the customers of the Company have
been established at considerable expense to the Company. Accordingly, Executive
covenants that, until June 20, 2008, Executive will not (i) knowingly employ or
solicit for employment, or directly or

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indirectly assist any other person or organization in employing or soliciting
for employment (herein, a "Solicitation") any employee of Corporation, Bank or
any of their corporate affiliates, except (1) an employee whose employment with
the Company has terminated prior to any Solicitation, or (2) after obtaining the
prior written consent of the Chief Executive Officer of the Corporation; or (ii)
knowingly solicit or assist a third party in soliciting any customer of the Bank
or the Corporation or any of their subsidiaries to do business with a competitor
of the Corporation or the Bank or any of their subsidiaries. Prior to the
Retirement Date, Executive shall refer to the Bank's President all inquiries
from prospective employers to whom a Company employee has submitted a job
application ("Inquiries"). After the Retirement Date, Executive shall be
entitled to respond to Inquiries in his individual capacity, but not on behalf
of the Company.

9. Noncompete Covenant.

(a) For the period ending June 20, 2008, Executive shall not, directly or
indirectly, within the marketing area of the Bank, which is defined as Chester
County, Pennsylvania and any additional areas within 5 miles of any current bank
office or branch, enter into or engage, or assist any other person in engaging,
in direct or indirect competition with the Bank, the Corporation or any
corporate affiliate of either of them in providing banking, insurance,
securities or other financial services, either as an individual on his own, or
as a partner or joint venturer, director, officer, shareholder, employee, agent,
independent contractor, consultant or any other capacity. Company agrees that
the provision by Executive of services, at any location, to a person or
organization that does not compete directly with the Bank or the Corporation or
any subsidiary of either of them, will not violate the foregoing covenant. The
existence of any immaterial claim or cause of action of the Executive against
the Company, whether predicated on this Agreement or otherwise, shall not
constitute a defense to the enforcement by the Company of this covenant. Any
breach by the Executive of the restrictions set forth in this Section will
result in irreparable injury to the Company for which it shall have no adequate
remedy at law and the Company shall be entitled to injunctive relief in order to
enforce the provisions hereof. In the event that this Section shall be
determined to be unenforceable in part by reason of it being too great a period
of time or covering too great a geographical area, it shall be in full force and
effect as to that period of time or geographical area determined by the
applicable decisional authority to be reasonable.

(b) In cases where Executive is in doubt whether a proposed activity would
violate the covenants in this Agreement, the Company agrees, promptly upon
request of the Executive if provided by the Executive with such relevant
information as the Company may reasonably request, to provide Executive in
writing with the Company's position on (i) whether the proposed activity would
violate any of the covenants in this Agreement and, (ii) if the Company believes
the proposed activity would violate this Agreement, whether the Company will
nevertheless consent to such proposed activity and if so under what conditions.

10. Confidentiality; Proprietary Information. Names and addresses of customers
of the Corporation and the Bank and of customers of each of their corporate
affiliates and of each third party with whom any of them has any contractual
relationship (collectively "Customers"), and any and all other nonpublic
information concerning the Corporation, the Bank, any of their

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corporate affiliates and each third party with whom any of them has any
contractual relationship are and shall remain confidential and the sole property
of the Company as its interests may appear (herein, "Confidential and
Proprietary Information") and Executive will use Confidential and Proprietary
Information solely for the benefit of the Company and for purposes for which the
Information was disclosed to the Executive. The Executive agrees that Executive
shall not, during or at any time after employment by the Company, use or
disclose to anyone, or permit or facilitate the disclosure by any third party
of, directly or indirectly, any of the Confidential and Proprietary Information
except as expressly authorized in writing by the Company. Notwithstanding the
foregoing, Executive shall not be prohibited from disclosing Confidential and
Proprietary Information pursuant to court order, lawful subpoena or regulatory
agency request, but Executive shall have given Company the maximum prior written
notice practicable under the circumstances, identifying the information to be
disclosed and the order, subpoena or regulatory request pursuant to which he is
obligated to make the disclosure, and Corporation shall have an opportunity to
intervene to protect Corporation's rights. As soon as practicable upon the
request of the Company but in any event no later than the Retirement Date, the
Executive shall turn over to the Company the originals and all copies of all
tangible, electronic and other data and documentation relating to or evidencing
or containing any Confidential and Proprietary Information. The provisions of
this Section are independent covenants and shall survive the termination,
expiration or modification of this Agreement.

11. Payments Conditional. All payments and benefits to Executive under this
Agreement are conditional upon a strict compliance with Executive's obligations
under this Agreement.

12. Release by Executive. The Executive, for himself and his personal
representatives and heirs, hereby releases and forever discharges the
Corporation and the Bank and all of their respective affiliated entities,
directors, officers, employees, shareholders, consultants, agents, accounting
firms, law firms, and each of the members thereof (in both their individual and
official capacities) from all claims or causes of action of any nature
whatsoever, known or unknown, based on any fact, circumstance, act, omission or
event occurring or existing at or prior to the execution of this Agreement
(except as hereafter specifically provided) including, but not limited to,
claims which Executive may have based on or relating to his employment with the
Company or the termination of that employment, except as hereafter specifically
provided. This includes, but is not limited to, a release of any defamation
claims and a release of any rights or claims which Executive may have under the
Age Discrimination in Employment Act, which prohibits age discrimination in
employment; Title VII of the Civil Rights Act of 1964, as amended, which
prohibits discrimination in employment based on race, color, national origin or
sex; the Equal Pay Act, which prohibits paying men and women unequal pay for
equal work; the Americans with Disabilities Act of 1990, which prohibits
discrimination against disabled persons; the Vocational Rehabilitation Act of
1973, which prohibits discrimination against handicapped persons, the
Pennsylvania Human Relations Act, or any other federal, state or local laws or
regulations prohibiting employment discrimination. Executive also intends to
release Company for any claim for wrongful discharge, any claim that Company
dealt with him unfairly or any other claims arising under common law which
relate, in any way, to his employment with Company or the termination thereof,
including, but not limited to, any defamation or other cause of action of any
nature whatsoever (whether or not similar to a defamation action). This Release
covers claims that Executive knows about, and those that he may not know about,
up through the

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date of this Release. This Release does not cover any claim that Executive may
make related to: (a) this Agreement; (b) any retirement or other employee
benefit plan maintained by the Company in which the Executive participates; (c)
the SERP; (d) any of the Stock Option Agreements; (e) any claim for
indemnification against the Corporation or the Bank.

13. Release by Company. The Corporation and the Bank, for themselves and their
successors, hereby release and forever discharge the Executive from any and all
claims or causes of action, known or unknown, based on any fact, circumstance,
act, omission, or event occurring or existing at or prior to the execution of
this Agreement, including any defamation claims, except as hereafter
specifically provided. This release does not cover any claim that the
Corporation or the Bank may make under any the following: This Release does not
cover any claim that Corporation or Bank or their corporate affiliates may
hereafter make related to: (a) this Agreement; (b) any retirement or other
employee benefit plan maintained by the Company in which the Executive
participates; (c) the SERP; (d) any of the Stock Option Agreements; or (e) any
past, present or future criminal action or regulatory violation by the
Executive, or any other matter as to which the Corporation or the Bank is not
required to indemnify the Executive under its or their articles of
incorporation, bylaws or applicable law or regulations.

14. Law Suits. Both parties promise never to file any claim or lawsuit against
the other or allow any other party acting on their behalf to file any claim or
lawsuit against the other based on any claims that are released in Sections 12
or 13 of this Agreement.

15. Attorney. Executive is hereby advised to consult with an independent
attorney of his choosing before signing this Agreement and acknowledges that he
has had the benefit of his own, separate counsel in the consideration and
negotiation of this Agreement. Each party agrees that it or he is solely
responsible for the fees of its or his own attorney in any matters relating to
this Agreement.

16. Review Period. Executive understands and agrees that he has been given a
period of twenty-one (21) days from December 3, 2004, the date he acknowledges
having received this Agreement, or until 5:00 p.m. prevailing Eastern time on
December 24, 2004 (the "Review Period") to review and consider this Agreement
before signing it. Executive understands that he may use as much or as little of
the Review Period as he wishes prior to signing.

17. Revocation; Effective Date. Executive may revoke this Agreement within seven
(7) days of his signing it. Revocation can be made by delivering a written
notice of revocation to Company in the manner provided for the giving of notices
under this Agreement. For this revocation to be effective, written notice must
be received by the Company no later than 5:00 p.m. prevailing Eastern time on
December 17, 2004, the seventh (7th) day after Executive has signed the
Agreement. If Executive timely revokes this Agreement, it shall not be effective
or enforceable and Executive will not receive the any of the payments described
in this Agreement. If Executive does not revoke this Agreement by 5:00 p.m.
prevailing Eastern time on December 17, 2004, this Agreement shall be fully
binding and effective immediately after 5:00 pm. prevailing Eastern time on
December 17, 2004 (referred to above as the "Effective Date").

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18. Notices. All notices, consents or other communications required or permitted
to be given under this Agreement shall be in writing and shall be deemed to have
been duly given (a) when delivered personally, (b) three business days after
being mailed by first class certified mail, return receipt requested, postage
prepaid, or (c) one business day after being sent by a reputable overnight
delivery service, postage or delivery charges prepaid, to the parties at their
respective addresses stated on the first page of this Agreement. Notice to each
party shall be sufficient if given to the following addresses:

If to the Corporation or the Bank:

                            DNB Financial Corporation
                         DNB First, National Association
                               4 Brandywine Avenue
                              Downingtown, PA 19335
              Attention: William S. Latoff, Chief Executive Officer

with a copy to its legal counsel:



                          Stradley Ronon Stevens & Young, LLP
                          30 Valley Stream Parkway
                          Malvern, PA 19355
                          Attention: David F. Scranton, Esquire

If to the Executive:      Henry F. Thorne
                          102 Carleton Road
                          Wallingford, PA 19086-6116



with a copy to his legal counsel:

James M. Penny, Esquire Obermayer Rebmann Maxwell & Hippel, LLP One Penn Center
- 19th Floor 1617 John F. Kennedy Blvd. Philadelphia, PA 19103-1895

Any party may change its address for notice and the address to which copies must
be sent by giving notice of the new addresses to the other parties in accordance
with this Section, except that any such change of address notice shall not be
effective unless and until received.

19. Miscellaneous.

(a) Section Headings. The section and subsection headings in this agreement are
used solely for convenience of reference, do not constitute a part of this
agreement, and shall not affect its interpretation.

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(b) Controlling Law. This Agreement is made under, and shall be construed and
enforced in accordance with, the laws of the Commonwealth of Pennsylvania
applicable to agreements made and to be performed solely therein, without giving
effect to principles of conflicts of law. IN VIEW OF THE FACT HAT EACH OF THE
PARTIES HERETO HAS BEEN REPRESENTED BY THEIR OWN COUNSEL AND THIS AGREEMENT HAS
BEEN FULLY EGOTIATED BY ALL PARTIES, THE LEGAL PRINCIPLE THAT AMBIGUITIES IN A
DOCUMENT ARE CONSTRUED AGAINST THE DRAFTSPERSON OF THAT DOCUMENT SHALL NOT APPLY
TO THIS AGREEMENT.

(c) Arbitration. Any claim or controversy arising out of or relating to this
Agreement or any breach thereof shall be settled by arbitration. Any such
arbitration shall take place in West Chester, Pennsylvania in accordance with
the rules of the American Arbitration Association. Judgment upon the written
award rendered by a majority of the arbitrators may be entered in the Court of
Common Pleas having jurisdiction thereof. The written decision of a majority of
the arbitrators shall be valid and binding, final and non-appealable.

(d) Parties Bound; No Third-Party Beneficiaries. This Agreement shall be binding
upon, and inure to the benefit of, the respective parties hereto and their
heirs, executors, administrators, successors and assigns at law. No provision of
this Agreement is intended to or shall be construed to grant or confer any right
to enforce this Agreement, or any remedy for breach of this Agreement, to or
upon any individual or entity other than the parties hereto.

(e) Right of Specific Performance and Other Equitable Remedies. Each party
acknowledges that, in the event of the breach of this Agreement, there is no
adequate remedy at law, and, in such event, each party shall be entitled to
specific performance of the obligations of the breaching party hereunder, in
addition to an other equitable rights and remedies.

(f) Entire Agreement. This Agreement constitutes the entire Agreement between
and among the parties with respect to its subject matter. No amendment, waiver
or termination of any of the provisions of this Agreement shall be effective
unless in writing and signed by the party against whom enforcement is sought.
Any written amendment, waiver or termination of this Agreement executed by the
Company and Executive shall be binding upon them and upon all other persons,
without the necessity of securing the consent of any other person.

(g) Waiver. Except as otherwise expressly set forth herein, no failure of any
party hereto to exercise and no delay in exercising any right, power or remedy
hereunder preclude any other or further exercise thereof or the exercise of any
other rights, power or remedy.

(h) Counterparts. This Agreement may be executed in one or more counterparts,
originally or by facsimile transmission, and all such counterparts shall
together constitute a single agreement.

[The balance of this page is intentionally left blank.]

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IN WITNESS WHEREOF, the parties hereto have each duly executed this Agreement as
of the date first mentioned above.

Witness: DNB FINANCIAL CORPORATION





                                              By:      /s/ William S. Latoff
--------------------------------                       ---------------------
Print Name: ______________________                     William S. Latoff
                                    Chairman

                                              DNB FIRST, NATIONAL ASSOCIATION


                                              By:     /s/ William S. Latoff
--------------------------------                      ---------------------
Print Name: ______________________                     William S. Latoff
                                    Chairman




                                                  /s/ Henry F. Thorne
--------------------------------                  -------------------
Print Name: ______________________            Henry F. Thorne, Individually



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