UNITED STATES DEPARTMENT OF THE TREASURY

1500 Pennsylvania Avenue, NW

Washington, D.C. 20220

October 21, 2009

Ladies and Gentlemen:

Reference is made to that certain Letter Agreement incorporating the Securities
Purchase Agreement – Standard Terms (the “Securities Purchase Agreement”), dated
as of the date set forth on Schedule A hereto, between the United States
Department of the Treasury (the “Investor”) and the company set forth on
Schedule A hereto (the “Company”).  Capitalized terms used but not defined
herein shall have the meanings assigned to them in the Securities Purchase
Agreement.  Pursuant to the Securities Purchase Agreement, at the Closing, the
Company issued to the Investor the number of shares of the series of its
preferred stock set forth on Schedule A hereto (the “Preferred Shares”) and a
warrant to purchase the number of shares of its common stock set forth on
Schedule A hereto (the “Warrant”).   

In connection with the consummation of the repurchase (the “Repurchase”) by the
Company from the Investor, on the date hereof, of the number of Preferred Shares
listed on Schedule A hereto (the “Repurchased Preferred Shares”), as permitted
by the Emergency Economic Stabilization Act of 2008, as amended by the American
Recovery and Reinvestment Act of 2009:

(a)

The Company hereby acknowledges receipt from the Investor of the share
certificate(s) set forth on Schedule A hereto representing the Preferred Shares;
and

(b)

The Investor hereby acknowledges receipt from the Company of a wire transfer to
the account of the Investor set forth on Schedule A hereto in immediately
available funds of the aggregate purchase price set forth on Schedule A hereto,
representing payment in full for the Repurchased Preferred Shares at a price per
share equal to the Liquidation Amount per share, together with any accrued and
unpaid dividends to, but excluding, the date hereof.

The Investor and the Company hereby agree that, notwithstanding Section 4.4 of
the Securities Purchase Agreement, immediately following consummation of the
Repurchase, but subject to compliance with applicable securities laws, the
Investor shall be permitted to Transfer all or a portion of the Warrant or
Substitute Warrant (as defined below) with respect to, and/or exercise the
Warrant or Substitute Warrant for, all or a portion of the number of shares of
Common Stock issuable thereunder, at any time and without limitation, and
Section 4.4 of the Securities Purchase Agreement shall be deemed to be amended
in order to permit the foregoing.  The Company shall take all steps as may be
reasonably requested by the Investor to facilitate any such Transfer.

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In addition, the Company agrees that within 15 calendar days of the date hereof
the Company shall either (a) deliver to the Investor a notice of intent to
repurchase the Warrant in accordance with Section 4.9(b) of the Securities
Purchase Agreement (the “Warrant Repurchase Notice”), or (b) issue and deliver
to the Investor a new warrant, in substantially the form of the Warrant, except
with the deletion of Section 13(H) thereof, to purchase the number of shares of
Common Stock into which the Warrant is then exercisable (the “Substitute
Warrant”), which Substitute Warrant shall be deemed the “Warrant” for all
purposes under the Securities Purchase Agreement.

In the event that the Company delivers a Warrant Repurchase Notice and the
Company and the Investor fail to agree on the Fair Market Value of the Warrant
pursuant to the procedures (including the Appraisal Procedure), and in
accordance with the time periods, set forth in Section 4.9(c) of the Securities
Purchase Agreement or the Company revokes the delivery of such Warrant
Repurchase Notice, then the Company shall deliver a Substitute Warrant to the
Investor within 5 calendar days of the earlier of the failure to agree on the
Fair Market Value and the revocation of the Warrant Repurchase Notice.

Effective as of the date of receipt of the Substitute Warrant, if applicable,
the Investor hereby provides notice, pursuant to Section 4.5(p) of the
Securities Purchase Agreement, of its intention to sell the Substitute Warrant.

This letter agreement will be governed by and construed in accordance with the
federal law of the United States if and to the extent such law is applicable,
and otherwise in accordance with the laws of the State of New York applicable to
contracts made and to be performed entirely within such State.

This letter agreement may be executed in any number of separate counterparts,
each such counterpart being deemed to be an original instrument, and all such
counterparts will together constitute the same agreement.  Executed signature
pages to this letter agreement may be delivered by facsimile and such facsimiles
will be deemed sufficient as if actual signature pages had been delivered.

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In witness whereof, the parties have duly executed this letter agreement as of
the date first written above.

UNITED STATES DEPARTMENT OF

THE TREASURY

By:  /s/Herbert M. Allison, Jr.               

      Name: Herbert M. Allison, Jr.

      Title: Assistant Secretary for Financial

Stability

COMPANY:

LCNB CORP.

By:  /s/Stephen P. Wilson                     

      Stephen P. Wilson

      Chief Executive Officer

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SCHEDULE A

General Information:

 

Date of Letter Agreement incorporating the Securities Purchase Agreement:

January 9, 2009

Name of the Company:

LCNB Corp.

Corporate or other organizational form of the Company:

Corporation

Jurisdiction of organization of the Company:

Ohio

Number and series of preferred stock issued to the Investor at the Closing:

13,400 shares of Fixed Rate Cumulative Perpetual Preferred Stock, Series A

Number of Initial Warrant Shares:

217,063

  

Terms of the Repurchase:

 

Number of Preferred Shares repurchased by the Company:

13,400 shares

Share certificate number (representing the Preferred Shares previously issued to
the Investor at the Closing):

1

Per share Liquidation Amount of Preferred Shares:

$1,000.00

Accrued and unpaid dividends on Preferred Shares:

$122,833.33

Aggregate purchase price for Repurchased Preferred Shares:

$13,522,833.33

Investor wire information for payment of purchase price:

ABA, Number: 021000018

Bank:  The Bank of New York Mellon

Account Name:  BETA EESA Preferred Account

Account Number:  GLA/111567