EXHIBIT 10.56
                                  -------------

                     DIRECTOR INCENTIVE RETIREMENT AGREEMENT

      THIS AGREEMENT is made this 1st day of September, 2004, by and between The
First  National Bank of  Litchfield,  a national  bank,  located in  Litchfield,
Connecticut (the "Company"), and KATHLEEN A. KELLEY (the "Director").

                                  INTRODUCTION

      In an effort to reward past service,  encourage  continued  service on the
Company's Board of Directors,  and as a method to attract future Directors,  the
Company is willing to provide to the Director a deferred incentive  opportunity.
The Company will pay the benefits from its general assets.

                                    AGREEMENT

      The Director and the Company agree as follows:

                                    Article 1
                                   Definitions

      1.1 Definitions.  Whenever used in this Agreement, the following words and
phrases shall have the meanings specified:

            1.1.1 "Annual Fees" means the Board of Director  retainer  fees, the
      Board of Director  meeting fees and the Board of Director  committee  fees
      earned by the Director during the Plan Year.

            1.1.2   "Change  of  Control"   means  a   reorganization,   merger,
      consolidation or sale of  substantially  all of the assets of the Company,
      or a similar transaction in which the Company is not the resulting entity;
      or individuals  who constitute the Incumbent  Board (as herein defined) of
      the Company  cease for any reason to  constitute a majority  thereof.  For
      these  purposes,  "Incumbent  Board"  means  the  members  of the Board of
      Directors of the Company on the effective date of the Plan,  provided that
      any person becoming a member of the Board of Directors  subsequent to such
      effective  date,  whose  election  was  approved  by a  vote  of at  least
      three-quarters  of the members of the Board of  Directors  comprising  the
      Incumbent   Board,  or  whose   nomination  for  election  by  members  or
      stockholders was approved by the same nominating  committee  serving under
      an Incumbent Board,  shall be considered as though he were a member of the
      Incumbent Board.

            1.1.3 "Code" means the Internal Revenue Code of 1986, as amended.

            1.1.4  "Deferral  Account"  means the  Company's  accounting  of the
      Director's accumulated Deferrals plus accrued interest.

            1.1.5  "Disability"  means  the  Director's   inability  to  perform
      substantially all normal duties of the Director's position,  as determined
      by the Company's Board of Directors in its sole discretion. As a condition
      to any  benefits,  the Company may require the  Director to submit to such
      physical or mental  evaluations  and tests as the Board of Directors deems
      appropriate.


                                       38
<PAGE>

            1.1.6 "Early  Retirement  Date" means the date that the Director has
      terminated  service before his 72nd birthday  provided he has completed at
      least 10 Years of Service.

            1.1.7  "Earnings"  means the  Company's  reported  Net Income  after
      taxes.

            1.1.8 "Earnings Growth" means the percentage change in the Company's
      Earnings over a one-year period, measured on December 31 of each year.

            1.1.9 "Effective Date" means the date first written above.

            1.1.10 "Election Form" means the Form attached as Exhibit 1.

            1.1.11   "Extraordinary  Items"  means  those  items  recognized  by
      Generally   Accepted   Accounting   Principles   as   extraordinary   that
      substantially  affect  shareholder  equity  and/or the  Company's  assets.
      Examples of such items are mergers,  acquisitions,  stock splits and other
      items of that nature.

            1.1.12  "Growth of Stock  Rate" means the  percentage  change in the
      Company's fair market value common stock price ("Stock  Price") over a one
      year  period,  measured  on December  31 of each year,  with a  guaranteed
      minimum of 4% and a maximum of 15%, cumulatively.

            1.1.13 "Return On Equity" means the Company's Earnings, adjusted for
      Extraordinary  Items,  divided by the Company's common stock equity at the
      end of the same fiscal year.

            1.1.14 "Normal Retirement Age" means the Director's 72nd birthday.

            1.1.15  "Normal  Retirement  Date"  means  the  later of the  Normal
      Retirement Age or Termination of Service.

            1.1.16  "Plan Year" means the calendar  year.  The initial Plan Year
      shall be a short Plan Year  commencing on the Effective Date and ending on
      December 31 of the same year.

            1.1.17  "Termination of Service" means the Director  ceasing to be a
      member of the Company's Board of Directors for any reason whatsoever.

            1.1.18  "Years of Service"  means the total  number of  twelve-month
      periods  during  which  the  Director  served  on the  Company's  Board of
      Directors  on a  full-time  basis,  inclusive  of any  approved  leave  of
      absence.


                                       39
<PAGE>

                                    Article 2
                                    Incentive

      2.1  Incentive  Award.  Return On Equity (the "ROE") and  Earnings  Growth
determined as of December 31 of each plan year shall  determine  the  Director's
Incentive  Award  Percentage,  in accordance  with the attached  Schedule A. The
chart on  Schedule  A is  specifically  subject to change  annually  at the sole
discretion  of  the  Company's  Board  of  Directors.  The  Incentive  Award  is
calculated  annually by taking the  Director's  Annual Fees for the Plan Year in
which the ROE and  Earnings  Growth was  calculated  times the  Incentive  Award
Percentage.

      2.2 Incentive  Deferral.  On March 1 following each Plan Year, the Company
shall declare and pay the Incentive  Award in the form of  compensation  and the
Director shall defer such amount to the Deferral Account.

                                    Article 3
                                Deferral Account

      3.1  Establishing  and Crediting.  The Company shall  establish a Deferral
Account on its books for the Director,  and shall credit to the Deferral Account
the following amounts:

            3.1.1 Deferrals.  The Incentive Deferral as determined under Article
      2.

            3.1.2 Interest.  On March 1 following each Plan Year and immediately
      prior to the payment of any  benefits,  interest  on the  account  balance
      since the preceding  credit under this Section  3.1.2,  at an annual rate,
      compounded  annually,  equal  to the  Growth  of  Stock  Rate for the same
      period.

      3.2 Statement of Accounts. The Company shall provide to the Director,
within one hundred twenty (120) days after each Plan Year, a statement setting
forth the Deferral Account balance.

      3.3 Accounting  Device Only.  The Deferral  Account is solely a device for
measuring amounts to be paid under this Agreement. The Deferral Account is not a
trust fund of any kind.  The  Director  is a general  unsecured  creditor of the
Company for the payment of  benefits.  The benefits  represent  the mere Company
promise to pay such  benefits.  The  Director's  rights  are not  subject in any
manner  to  anticipation,   alienation,  sale,  transfer,   assignment,  pledge,
encumbrance, attachment, or garnishment by the Director's creditors.

      3.4 Hardship.  If an unforeseeable  financial  emergency  arising from the
death of a family  member,  divorce,  sickness,  injury,  catastrophe or similar
event  outside the control of the  Director  occurs,  the  Director,  by written
instructions to the Company, may reduce future deferrals under this Agreement.

                                    Article 4
                                Lifetime Benefits

      4.1 Normal Retirement  Benefit.  If the Director  terminates service on or
after the Normal  Retirement Age for reasons other than death, the Company shall
pay to the Director the benefit described in this Section


                                       40
<PAGE>

4.1 in lieu of any other benefit under this Agreement.

            4.1.1 Amount of Benefit.  The benefit  under this Section 4.1 is the
      Deferral Account balance on the Director's Normal Retirement Date.

            4.1.2  Payment of Benefit.  The Company shall pay the benefit to the
      Director commencing on the first day of the month following the Director's
      Normal Retirement Date in the form elected by the Director on the Election
      Form.  If the  Director  elects  to  receive  payments  in  equal  monthly
      installments,  the  Company  shall  continue  to  credit  interest  on the
      remaining account balance during any applicable  installment  period fixed
      at the rate in effect under  Section  3.1.2 on the date of the  Director's
      Termination of Service.

      4.2 Early Retirement  Benefit.  If the Director  terminates  service on or
after the Early  Retirement  Date and before the Normal  Retirement Age, and for
reasons other than Change of Control, death or Disability, the Company shall pay
to the Director the benefit  described in this 4.2 in lieu of any other  benefit
under this Agreement.

            4.2.1 Amount of Benefit.  The benefit  under this Section 4.2 is the
      Deferral Account balance on the Director's Early Retirement Date.

            4.2.2  Payment of Benefit.  The Company shall pay the benefit to the
      Director  in the form  and on the  date  elected  by the  Director  on the
      Election  Form. If the Director  elects the Deferred  Payment Option or to
      receive payments in equal monthly installments, the Company shall continue
      to credit interest on the remaining  account balance during any applicable
      installment  period fixed at the rate in effect under Section 3.1.2 on the
      date of the Director's Termination of Service.

            4.2.3 Deferred Payment Option.  Under this Section 4.2, the Director
      may elect to defer payment of his Early Retirement  Benefit until the date
      elected by the Director on the Election  Form, not to exceed the first day
      of the month following his Normal Retirement Age.

      4.3 Early Termination  Benefit.  If the Director terminates service before
the Early Retirement Age or Normal  Retirement Age for reasons other than Change
of Control,  death or  Disability,  the Company  shall pay to the  Director  the
benefit described in the 4.3 in lieu of any other benefits under this Agreement.

            4.3.1 Amount of Benefit.  The benefit  under this Section 4.3 is the
      vested  portion  of  the  Deferral   Account  balance  on  the  Director's
      Termination of Service.

            4.3.2 Vesting of Awards. For purposes of this Section 4.3, Incentive
      Awards  will vest 20% per year from the date the award was  declared.  The
      Interest credited to each Incentive Award will also vest 20% per year from
      the date the award was declared.

            4.3.3  Payment of Benefit.  The Company shall pay the benefit to the
      Director in a single lump sum within 60 days after Termination of Service.

      4.4 Disability  Benefit. If the Director terminates service for Disability
prior to the Early  Retirement Age or Normal  Retirement  Age, the Company shall
pay to the  Director  the benefit  described  in this Section 4.4 in lieu of any
other benefit under this Agreement.


                                       41
<PAGE>

            4.4.1 Amount of Benefit.  The benefit  under this Section 4.4 is the
      Deferral Account balance at Termination of Service.

            4.4.2  Payment of Benefit.  The Company shall pay the benefit to the
      Director commencing on the first day of the month following the Director's
      Normal  Retirement Age in the form elected by the Director on the Election
      Form.  If the  Director  elects  to  receive  payments  in  equal  monthly
      installments,  the  Company  shall  continue  to  credit  interest  on the
      remaining account balance during any applicable  installment  period fixed
      at the rate in effect under  Section  3.1.2 on the date of the  Director's
      Termination of Service.

      4.5 Change of Control Benefit. Upon a Change of Control while the Director
is in the active  service of the Company,  the Company shall pay to the Director
the benefit  described  in this Section 4.5 in lieu of any other  benefit  under
this Agreement.

            4.5.1  Amount of  Benefit.  The  benefit  under  Section  4.5 is the
      Deferral  Account  balance on the date of the  Director's  Termination  of
      Service.

            4.5.2  Payment of Benefit.  The Company shall pay the benefit to the
      Director in a lump-sum  payment no later than 60 days after the Director's
      Termination of Service.

      4.6 Hardship  Distribution.  Upon the Company's  determination  (following
petition by the  Director)  that the  Director  has  suffered  an  unforeseeable
financial emergency as described in Section 3.4, the Company shall distribute to
the Director 100% of the vested portion of the Deferral Account balance.

                                    Article 5
                                 Death Benefits

      5.1 Death During Active Service.  If the Director dies while in the active
service of the Company, the Company shall pay to the Director's  beneficiary the
benefit described in this Section 5.1.

            5.1.1  Amount of  Benefit.  The  benefit  under  Section  5.1 is the
      greater  of the  Deferral  Account  balance  or the  projected  retirement
      benefit as per the attached Schedule B.

            5.1.2  Payment of Benefit.  The Company shall pay the benefit to the
      beneficiary  in the form elected by the Director on the Election  Form. If
      the Director  elects payments in equal monthly  installments,  the Company
      shall continue to credit interest on the remaining  account balance during
      any  applicable  installment  period  fixed  at the rate in  effect  under
      Section 3.1.2 on the date of the Director's Termination of Service.

      5.2 Death  During  Benefit  Period.  If the  Director  dies after  benefit
payments  have  commenced  under this  Agreement  but before  receiving all such
payments,  the  Company  shall  pay the  remaining  benefits  to the  Director's
beneficiary  at the same time and in the same  amounts they would have been paid
to the Director had the Director survived.

      5.3 Death  After  Termination  of  Service  But  Before  Benefit  Payments
Commence.  If the Director is entitled to benefit payments under this Agreement,
but dies prior to the commencement of said benefit  payments,  the Company shall
pay the benefit  payments to the  Director's  beneficiary  that the Director was
entitled to prior to death except that the benefit  payments  shall  commence on
the first day of the month


                                       42
<PAGE>

following the date of the Director's death.

                                    Article 6
                                  Beneficiaries

      6.1 Beneficiary  Designations.  The Director shall designate a beneficiary
by filing a written  designation  with the  Company.  The Director may revoke or
modify  the  designation  at any  time by  filing  a new  designation.  However,
designations  will only be  effective  if signed by the Director and accepted by
the  Company  during  the  Director's  lifetime.   The  Director's   beneficiary
designation shall be deemed automatically revoked if the beneficiary predeceases
the Director,  or if the Director names a spouse as beneficiary and the marriage
is  subsequently  dissolved.  If the Director  dies without a valid  beneficiary
designation, all payments shall be made to the Director's estate in a lump sum.

      6.2 Facility of Payment.  If a benefit is payable to a minor,  to a person
declared  incompetent,  or to a person  incapable of handling the disposition of
his or her  property,  the Company may pay such benefit to the  guardian,  legal
representative  or person having the care or custody of such minor,  incompetent
person or  incapable  person.  The Company may  require  proof of  incompetence,
minority or guardianship as it may deem appropriate prior to distribution of the
benefit.  Such  distribution  shall  completely  discharge  the Company from all
liability with respect to such benefit.

                                    Article 7
                               General Limitations

      Notwithstanding  any  provision  of this  Agreement to the  contrary,  the
Company shall not pay any benefit under this Agreement:

      7.1 Excess  Parachute  Payment.  To the extent the benefit would create an
excise tax under the excess parachute rules of Section 280G of the Code.

      7.2 Suicide.  If the Director  commits  suicide within two years after the
date of this Agreement, or if the Director has made any material misstatement of
fact on any application for life insurance purchased by the Company.

                                    Article 8
                          Claims and Review Procedures

      8.1 Claims  Procedure.  The Company shall notify any person or entity that
makes a claim against the Agreement (the  "Claimant") in writing,  within ninety
(90)  days  of  Claimant's  written  application  for  benefits,  of  his or her
eligibility or noneligibility  for benefits under the Agreement.  If the Company
determines that the Claimant is not eligible for benefits or full benefits,  the
notice shall set forth (1) the specific reasons for such denial,  (2) a specific
reference to the provisions of the Agreement on which the denial is based, (3) a
description of any additional information or material necessary for the Claimant
to perfect his or her claim,  and a description of why it is needed,  and (4) an
explanation of the  Agreement's  claims review  procedure and other  appropriate
information as to the steps to be taken if the Claimant wishes


                                       43
<PAGE>

to have the claim  reviewed.  If the Company  determines  that there are special
circumstances  requiring  additional time to make a decision,  the Company shall
notify  the  Claimant  of the  special  circumstances  and the  date by  which a
decision is expected to be made, and may extend the time for up to an additional
ninety-day period.

      8.2 Review Procedure.  If the Claimant is determined by the Company not to
be eligible for benefits, or if the Claimant believes that he or she is entitled
to greater or different  benefits,  the Claimant  shall have the  opportunity to
have such claim reviewed by the Company by filing a petition for review with the
Company  within  sixty  (60) days  after  receipt  of the  notice  issued by the
Company.  Said  petition  shall state the  specific  reasons  which the Claimant
believes  entitle him or her to benefits  or to greater or  different  benefits.
Within sixty (60) days after receipt by the Company of the petition, the Company
shall afford the Claimant (and counsel, if any) an opportunity to present his or
her position to the Company orally or in writing,  and the Claimant (or counsel)
shall have the right to review the pertinent documents. The Company shall notify
the Claimant of its decision in writing  within the  sixty-day  period,  stating
specifically  the basis of its  decision,  written in a manner  calculated to be
understood by the Claimant and the specific provisions of the Agreement on which
the  decision is based.  If,  because of the need for a hearing,  the  sixty-day
period  is not  sufficient,  the  decision  may be  deferred  for up to  another
sixty-day  period at the  election of the Company,  but notice of this  deferral
shall be given to the Claimant.

                                    Article 9
                           Amendments and Termination

      This  Agreement may be amended or terminated  only by a written  agreement
signed by the Company.

                                   Article 10
                                  Miscellaneous

      10.1  Binding  Effect.  This  Agreement  shall bind the  Director  and the
Company,   and   their   beneficiaries,    survivors,   executors,   successors,
administrators and transferees.

      10.2 No  Guarantee  of  Service.  This  Agreement  is not a  contract  for
services.  It does not give the  Director  the right to remain a Director of the
Company,  nor does it  interfere  with the  shareholders'  rights to replace the
Director.  It also  does not  require  the  Director  to remain a  Director  nor
interfere with the Director's right to terminate services at any time.

      10.3  Non-Transferability.  Benefits under this Agreement  cannot be sold,
transferred, assigned, pledged, attached or encumbered in any manner.

      10.4  Reorganization.  The Company shall not merge or consolidate  into or
with another company, or reorganize,  or sell substantially all of its assets to
another company,  firm, or person unless such succeeding or continuing  company,
firm, or person agrees to assume and  discharge the  obligations  of the Company
under this Agreement.  Upon the occurrence of such event,  the term "Company" as
used in this  Agreement  shall be deemed to refer to the  successor  or survivor
company.

      10.5 Tax  Withholding.  The  Company  shall  withhold  any taxes  that are
required to be withheld from the benefits provided under this Agreement.

      10.6 Applicable  Law. The Plan and all rights  hereunder shall be governed
by and construed


                                       44
<PAGE>

according to the laws of Connecticut, except to the extent preempted by the laws
of the United States of America.

      10.7  Unfunded  Arrangement.  The  Director  and  beneficiary  are general
unsecured  creditors  of the  Company  for the  payment of  benefits  under this
Agreement.  The benefits  represent  the mere promise by the Company to pay such
benefits.  The rights to benefits are not subject in any manner to anticipation,
alienation,  sale, transfer,  assignment,  pledge,  encumbrance,  attachment, or
garnishment  by  creditors.  Any insurance on the  Director's  life is a general
asset of the Company to which the Director and beneficiary  have no preferred or
secured claim.

      10.8 Recovery of Estate Taxes. If the Director's  gross estate for federal
estate tax  purposes  includes  any amount  determined  by  reference  to and on
account of this  Agreement,  and if the beneficiary is other than the Director's
estate,  then the  Director's  estate  shall be  entitled  to  recover  from the
beneficiary  receiving such benefit under the terms of the Agreement,  an amount
by which the total estate tax due by the  Director's  estate,  exceeds the total
estate tax which  would have been  payable if the value of such  benefit had not
been included in the Director's  gross estate.  If there is more than one person
receiving such benefit, the right of recovery shall be against each such person.
In the event the  beneficiary  has a liability  hereunder,  the  beneficiary may
petition  the  Company  for a lump sum  payment  in an amount  not to exceed the
beneficiary's liability hereunder.

      10.9 Entire  Agreement.  This Agreement  constitutes the entire  agreement
between the Company and the Director as to the subject matter hereof.  No rights
are  granted  to the  Director  by virtue of this  Agreement  other  than  those
specifically set forth herein.

      10.10 Administration. The Company shall have powers which are necessary to
administer this Agreement, including but not limited to:

            10.10.1  Interpreting the provisions of the Agreement;

            10.10.2  Establishing  and revising the method of accounting for the
                     Agreement;

            10.10.3  Maintaining a record of benefit payments; and

            10.10.4  Establishing  rules and  prescribing any forms necessary or
                     desirable to administer the Agreement.

      10.11 Designated Fiduciary. For purposes of the Employee Retirement Income
Security Act of 1974, if  applicable,  the Company shall be the named  fiduciary
and plan administrator under the Agreement.  The named fiduciary may delegate to
others certain aspects of the management and operation  responsibilities  of the
plan including the service of advisors and the delegation of ministerial  duties
to qualified individuals.

      IN WITNESS  WHEREOF,  the Director and a duly  authorized  Company officer
have signed this Agreement.

DIRECTOR:                           COMPANY:

                                    The First National Bank of Litchfield


/s/ Kathleen A. Kelley              By /s/ Joseph J. Greco
------------------------------      -----------------------------------
KATHLEEN A. KELLEY                  Joseph J. Greco
                                    Title  President and Chief Executive Officer


                                       45
<PAGE>

                                  EXHIBIT 1 TO

DIRECTOR INCENTIVE RETIREMENT AGREEMENT

                           Normal Retirement Benefits
                           --------------------------

I elect to receive my Normal Retirement Benefits under Section 4.1.2 of the
Agreement in the following form:

[Initial One]

|X| Lump sum

|_| Equal monthly installments for 120 months.

                            Early Retirement Benefits
                            -------------------------

I elect to receive my Early Retirement Benefits under Section 4.2.2 of the
Agreement in the following form:

[Initial One]

|X| Lump sum, payable on the first day of the month following my Early
Retirement Date.

|_| Deferred Lump sum, payable on _____________________________.

|_| Equal monthly installments for 120 months commencing on the first day of the
month following my Early Retirement Date.

|_| Deferred Equal monthly installments for 120 months commencing on
____________________.

                               Disability Benefits
                               -------------------

I elect to receive my Disability Benefits under Section 4.4.2 of the Agreement
in the following form:

[Initial One]

|X| Lump sum

|_| Equal monthly installments for 120 months.

                                 Death Benefits
                                 --------------

I elect to have my Death Benefit paid under Section 5.1.2 of the Agreement in
the following form:

[Initial One]

|X| Lump sum

|_| Equal monthly installments for 120 months.


Signature /s/ Kathleen A. Kelley
         -----------------------

Date 9/1/04

Accepted by the Company this 1st day of September , 2004.


By /s/ Joseph J. Greco .
   -------------------
Title President and Chief Executive Officer .
      ---------------------------------------


                                       46
<PAGE>

                             BENEFICIARY DESIGNATION

                      The First National Bank of Litchfield
                     DIRECTOR INCENTIVE RETIREMENT AGREEMENT

                               KATHLEEN A. KELLEY

I  designate  the  following  as  beneficiary  of any death  benefits  under the
Director Incentive Retirement Agreement:

Primary: Maureen K. Perugini
         -----------------------------------------------------------------------
Contingent: Lisa M. Perugini
            --------------------------------------------------------------------

--------------------------------------------------------------------------------

Note: To name a trust as beneficiary,  please provide the name of the trustee(s)
      and the exact name and date of the trust agreement.

I understand  that I may change these  beneficiary  designations by filing a new
written designation with the Company. I further understand that the designations
will be automatically  revoked if the beneficiary  predeceases me, or, if I have
named my spouse as beneficiary and our marriage is subsequently dissolved.


Signature /s/ Kathleen A. Kelley
          ----------------------------

Date September 1, 2004
     ----------------------------------

Accepted by the Company this 1st day of September, 2004.


By /s/ Joseph J. Greco .
   ---------------------

Title President and Chief Executive Officer .
      ---------------------------------------

11/11/04 9:22 AM


                                       47
<PAGE>

                                   Schedule A

                      Deferred Bonus as a % of Annual Fees

<TABLE>
<CAPTION>
                      -------------------------------------------------------------------------------
<S>                       <C>           <C>          <C>          <C>          <C>          <C>
            14.0%         34.5          37.8         40.8         43.9         47.1         50.2
                      -------------------------------------------------------------------------------
            13.0%         32.3          34.9         38.2         41.1         44.0         47.0
                      -------------------------------------------------------------------------------
            12.0%         30.1          32.6         35.5         38.3         41.0         43.7
Earnings              -------------------------------------------------------------------------------
 Growth     11.0%         27.8          30.3         32.9         35.4         38.0         40.5
                      -------------------------------------------------------------------------------
            10.0%         25.6          28.0         30.3         32.6         34.9         37.2
                      -------------------------------------------------------------------------------
             9.0%         23.4          25.8         27.6         29.8         31.9         34.0
                      -------------------------------------------------------------------------------
             8.0%         21.2          22.5         25.0         26.9         28.8         30.8
                      -------------------------------------------------------------------------------
             7.0%         18.9          19.6         22.4         24.1         25.8         27.5
                      -------------------------------------------------------------------------------
             6.0%         16.7          17.6         19.7         21.3         22.8         24.3
                      -------------------------------------------------------------------------------
             5.0%         14.5          15.8         17.1         18.4         19.7         21.1
                      -------------------------------------------------------------------------------
                          11.0%         12.0%        13.0%        14.0%        15.0%        16.0%
</TABLE>