Document:

Exhibit 10.1
    

    

    

    
      LNB BANCORP, INC.
2006 STOCK INCENTIVE PLAN
    

    
      (Restated as of December 15, 2009)
    

    

    

    
      ARTICLE 1
    

    
       General Purpose of Plan; Definitions
    

    
           1.1 Name and Purposes. The name of
      this Plan is the LNB Bancorp, Inc. 2006 Stock Incentive Plan. The
      purpose of this Plan is to enable LNB Bancorp, Inc. and its Affiliates
      to: (i) attract and retain skilled and qualified officers and key
      employees who are expected to contribute to the Company’s success by
      providing long-term incentive compensation opportunities competitive
      with those made available by other companies; (ii) motivate participants
      to achieve the long-term success and growth of the Company;
      (iii) facilitate ownership of shares of the Company; and (iv) align the
      interests of the participants with those of the Company’s shareholders.
    

    
           1.2 Certain Definitions. Unless the
      context otherwise indicates, the following words used herein shall have
      the following meanings whenever used in this instrument:
    

    
                (a) “Affiliate” means any corporation, partnership, joint
      venture or other entity, directly or indirectly, through one or more
      intermediaries, controlling, controlled by, or under common control with
      the Company within the meaning of Code Section 414(b) or (c).
    

    
                (b) “Award” means any grant under this Plan of a Stock Option,
      Stock Appreciation Right, Restricted Share, Restricted Share Unit or
      Performance Share to any Plan participant.
    

    
                (c) “Board of Directors” mean the Board of Directors of the
      Company, as constituted from time to time.
    

    
                (d) “Code” means the Internal Revenue Code of 1986, as
      amended, and any lawful regulations or guidance promulgated thereunder.
      Whenever reference is made to a specific Internal Revenue Code section,
      such reference shall be deemed to be a reference to any successor
      Internal Revenue Code section or sections with the same or similar
      purpose.
    

    
                (e) “Committee” means the committee administering this Plan as
      provided in Section 2.1.
    

    
                (f) “Common Shares” mean the common shares, $1.00 par value
      per share, of the Company.
    

    
                (g) “Company” means LNB Bancorp, Inc., a corporation organized
      under the laws of the State of Ohio and, except for purposes of
      determining whether a Change in Control has occurred, any corporation or
      entity that is a successor to LNB Bancorp, Inc. or substantially all of
      the assets of LNB Bancorp, Inc. and that assumes the obligations of LNB
      Bancorp, Inc. under this Plan by operation of law or otherwise.
    

    
      
        

        

      

      
        

        

        
          

        

      

      
        

        

      

    

    
                (h) “Date of Grant” means the date on which the Committee
      grants an Award.
    

    
                (i) “Director” means a member of the Board of Directors.
    

    
                (j) “Eligible Employee” is defined in Article 4.
    

    
                (k) “Exchange Act” means the Securities Exchange Act of 1934,
      as amended, and any lawful regulations or guidance promulgated
      thereunder.
    

    
                (l) “Exercise Price” means the purchase price of a Share
      pursuant to a Stock Option, or the exercise price per Share related to a
      Stock Appreciation Right.
    

    
                (m) “Fair Market Value” means the closing price of a Share as
      reported on The Nasdaq Stock Market, or, if applicable, on any national
      securities exchange or automated quotation system on which the Common
      Shares are principally traded, on the date for which the determination
      of Fair Market Value is made, or, if there are no sales of Common Shares
      on such date, then on the most recent immediately preceding date on
      which there were any sales of Common Shares. If the Common Shares are
      not, or cease to be, traded on The Nasdaq Stock Market or any national
      securities exchange or automated quotation system, the “Fair Market
      Value” of Common Shares shall be determined pursuant to a reasonable
      valuation method prescribed by the Committee. Notwithstanding the
      foregoing, as of any date, the “Fair Market Value” of Common Shares
      shall be determined in a manner consistent with Code Section 409A and
      the guidance then-existing thereunder. In addition, “Fair Market Value”
      with respect to ISOs and related SARs shall be determined in accordance
      with Section 6.2(f).
    

    
                (n) “Incentive Stock Option” and “ISO” mean a Stock Option
      that is identified as such and which meets the requirements of
      Section 422 of the Code.
    

    
                (o) “Non-Qualified Stock Option” and “NQSO” mean a Stock
      Option that: (i) is governed by Section 83 of the Code; and (ii) does
      not meet the requirements of Section 422 of the Code.
    

    
                (p) “Outside Director” means a Director who meets the
      definitions of the terms “outside director” set forth in Section 162(m)
      of the Code, “independent director” set forth in The Nasdaq Stock
      Market, Inc. rules, and “non-employee director” set forth in Rule 16b-3,
      or any successor definitions adopted by the Internal Revenue Service,
      The Nasdaq Stock Market, Inc. and Securities and Exchange Commission,
      respectively, and similar requirements under any other applicable laws
      and regulations.
    

    
                (q) “Parent” means any corporation which qualifies as a
      “parent corporation” of the Company under Section 424(e) of the Code.
    

    
                (r) “Performance Shares” is defined in Article 9.
    

    
                (s) “Performance Period” is defined in Section 9.2.
    

    
      
        

        

      

      
        
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                (t) “Plan” means this LNB Bancorp, Inc. 2006 Stock Incentive
      Plan, as amended from time to time.
    

    
                (u) “Restricted Share Units” is defined in Article 8.
    

    
                (v) “Restricted Shares” is defined in Article 8.
    

    
                (w) “Rule 16b-3” is defined in Article 16.
    

    
                (x) “Section 162(m) Person” means, for any taxable year, a
      person who is a “covered employee” within the meaning of
      Section 162(m)(3) of the Code.
    

    
                (y) “Share” or “Shares” mean one or more of the Common Shares.
    

    
                (z) “Shareholder” means an individual or entity that owns one
      or more Shares.
    

    
                (aa) “Stock Appreciation Rights” and “SARs” mean any right to
      receive the appreciation in Fair Market Value of a specified number of
      Shares over a specified Exercise Price pursuant to an Award granted
      under Article 7.
    

    
                (bb) “Stock Option” means any right to purchase a specified
      number of Shares at a specified price which is granted pursuant to
      Article 5 and may be an Incentive Stock Option or a Non-Qualified Stock
      Option.
    

    
                (cc) “Stock Power” means a power of attorney executed by a
      participant and delivered to the Company which authorizes the Company to
      transfer ownership of Restricted Shares, Performance Shares or Common
      Shares from the participant to the Company or a third party.
    

    
                (dd) “Subsidiary” means any corporation which qualifies as a
      “subsidiary corporation” of the Company under Section 424(f) of the Code.
    

    
                (ee) “Vested” means, with respect to a Stock Option, that the
      time has been reached when the option to purchase Shares first becomes
      exercisable; and with respect to a Stock Appreciation Right, when the
      Stock Appreciation Right first becomes exercisable for payment; with
      respect to Restricted Shares, when the Shares are no longer subject to
      forfeiture and restrictions on transferability; with respect to
      Restricted Share Units and Performance Shares, when the units or Shares
      are no longer subject to forfeiture and are convertible to Shares. The
      words “Vest” and “Vesting” have meanings correlative to the foregoing.
    

    

    

    
      ARTICLE 2
    

    
      Administration
    

    
           2.1 Authority and Duties of the
      Committee.
    

    
                (a) The Plan shall be administered by a Committee of at least
      three Directors who are appointed by the Board of Directors. Unless
      otherwise determined by the Board of Directors, the Compensation
      Committee of the Board of Directors (or any subcommittee thereof) shall
      serve as the Committee, and all of the members of the Committee shall be
      Outside Directors. Notwithstanding the requirement that the Committee
      consist exclusively of Outside Directors, no action or determination by
      the Committee or an individual then considered to be an Outside Director
      shall be deemed void because a member of the Committee or such
      individual fails to satisfy the requirements for being an Outside
      Director, except to the extent required by applicable law.
    

    
      
        

        

      

      
        
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                (b) The Committee has the power and authority to grant Awards
      pursuant to the terms of this Plan to Eligible Employees.
    

    
                (c) The Committee has the sole and exclusive authority,
      subject to any limitations specifically set forth in this Plan, to:
    

    
    	
           
        	
          (i)
        	
          select the Eligible Employees to whom Awards are granted;
        
	

        	

        	
           
        
	

        	
          (ii)
        	
          determine the types of Awards granted and the timing of such Awards;
        
	

        	

        	
           
        
	

        	
          (iii)
        	
          determine the number of Shares to be covered by each Award granted
          hereunder;
        
	

        	

        	
           
        
	

        	
          (iv)
        	
          determine whether an Award is, or is intended to be,
          “performance-based compensation” within the meaning of Section
          162(m) of the Code;
        
	

        	

        	
           
        
	

        	
          (v)
        	
          determine the other terms and conditions, not inconsistent with the
          terms of this Plan, of any Award granted hereunder; such terms and
          conditions include, but are not limited to, the Exercise Price, the
          time or times when Options or Stock Appreciation Rights may be
          exercised (which may be based on performance objectives), any
          Vesting, acceleration or waiver of forfeiture restrictions, any
          performance criteria (including any performance criteria as
          described in Section 162(m)(4)(C) of the Code) applicable to an
          Award, and any restriction or limitation regarding any Option or
          Stock Appreciation Right or the Common Shares relating thereto,
          based in each case on such factors as the Committee, in its sole
          discretion, shall determine;
        
	

        	

        	
           
        
	

        	
          (vi)
        	
          determine whether any conditions or objectives related to Awards
          have been met, including any such determination required for
          compliance with Section 162(m) of the Code;
        
	

        	

        	
           
        
	

        	
          (vii)
        	
          subsequently modify or waive any terms and conditions of Awards, not
          inconsistent with the terms of this Plan;
        
	

        	

        	
           
        
	

        	
          (viii)
        	
          adopt, alter and repeal such administrative rules, guidelines and
          practices governing this Plan as it deems advisable from time to
          time;
        
	

        	

        	
           
        
	

        	
          (ix)
        	
          promulgate such administrative forms as it from time to time deems
          necessary or appropriate for administration of the Plan;
        
	

        	

        	
           
        
	

        	
          (x)
        	
          construe, interpret, administer and implement the terms and
          provisions of this Plan, any Award and any related agreements;
        

    

    
      
        

        

      

      
        
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          (xi)
        	
          correct any defect, supply any omission and reconcile any
          inconsistency in or between the Plan, any Award and any related
          agreements;
        
	

        	

        	
           
        
	

        	
          (xii)
        	
          prescribe any legends to be affixed to certificates representing
          Shares or other interests granted or issued under the Plan; and
        
	

        	

        	
           
        
	

        	
          (xiii)
        	
          otherwise supervise the administration of this Plan.
        

    

    
                (d) All decisions made by the Committee pursuant to the
      provisions of this Plan are final and binding on all persons, including
      the Company, its shareholders and participants, but may be made by their
      terms subject to ratification or approval by, the Board of Directors,
      another committee of the Board of Directors or shareholders.
    

    
                (e) The Company shall furnish the Committee with such clerical
      and other assistance as is necessary for the performance of the
      Committee’s duties under the Plan.
    

    
           2.2 Delegation of Duties. The
      Committee may delegate ministerial duties to any other person or
      persons, and it may employ attorneys, consultants, accountants or other
      professional advisers for purposes of plan administration at the expense
      of the Company.
    

    
           2.3 Limitation of Liability.
      Members of the Board of Directors, members of the Committee and Company
      employees who are their designees acting under this Plan shall be fully
      protected in relying in good faith upon the advice of counsel and shall
      incur no liability except for gross or willful misconduct in the
      performance of their duties hereunder.
    

    

    

    
      ARTICLE 3
    

    
      Stock Subject to Plan
    

    
           3.1 Total Shares Limitation.
      Subject to the provisions of this Article, the maximum number of Shares
      that may be issued or transferred (a) upon the exercise of Stock Options
      or Stock Appreciation Rights, (b) as Restricted Shares and released from
      a substantial risk of forfeiture thereof, (c) in payment of Restricted
      Share Units, (d) in payment of Performance Shares that have been earned,
      or (e) in payment of any other Award granted under this Plan, shall not
      exceed in the aggregate 600,000 Common Shares, which may be treasury or
      authorized but unissued Shares.
    

    
           3.2 Other Limitations.
    

    
                (a) Stock
      Option Limitations. The maximum number of Shares that may be issued
      with respect to all Stock Options (whether Incentive Stock Options or
      Non-Qualified Stock Options) granted in the aggregate under this Plan is
      400,000 Shares.
    

    
                (b) Restricted
      Share, Restricted Share Unit and Performance Share Limitations. The
      maximum number of Shares that may be issued (i) as Restricted Shares and
      released from a substantial risk of forfeiture thereof and (ii) in
      payment of Restricted Share Units or Performance Shares that have been
      earned under this Plan, shall not exceed in the aggregate 200,000 Shares.
    

    
      
        

        

      

      
        
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                (c) Participant
      Limitation. The aggregate number of Shares underlying Awards granted
      under this Plan to any participant in any fiscal year (including but not
      limited to Awards of Stock Options and SARs), regardless of whether such
      Awards are thereafter canceled, forfeited or terminated, shall not
      exceed 60,000 Shares. The foregoing annual limitation is intended to
      include the grant of all Awards, including but not limited to, Awards
      representing “performance-based compensation” as described in
      Section 162(m)(4)(C) of the Code.
    

    
           3.3 Awards Not Exercised; Effect of
      Receipt of Shares. If any outstanding Award, or portion thereof,
      expires, or is terminated, canceled or forfeited, the Shares that would
      otherwise be issuable or released from restrictions with respect to the
      unexercised or non-Vested portion of such expired, terminated, canceled
      or forfeited Award shall be available for subsequent Awards under this
      Plan. If the Exercise Price of an Award is paid in Shares, the Shares
      received by the Company in connection therewith shall not be added to
      the maximum aggregate number of Shares which may be issued under
      Section 3.1.
    

    
           3.4 Dilution and Other Adjustments.
      In the event that the Committee determines that any dividend or other
      distribution (whether in the form of cash, Shares, other securities or
      other property), recapitalization, stock split, reverse stock split,
      reorganization, redesignation, reclassification, merger, consolidation,
      liquidation, split-up, reverse split, spin-off, combination, repurchase
      or exchange of Shares or other securities of the Company, issuance of
      warrants or other rights to purchase Shares or other securities of the
      Company or other similar corporate transaction or event affects the
      Shares such that an adjustment is determined by the Committee to be
      appropriate in order to prevent dilution or enlargement of the benefits
      or potential benefits intended to be made available under this Plan,
      then the Committee may, in such manner as it deems equitable, adjust any
      or all of (i) the number and type of Shares (or other securities or
      other property) which thereafter may be made the subject of Awards,
      (ii) the number and type of Shares (or other securities or other
      property) subject to outstanding Awards, (iii) the limitations set forth
      above and (iv) the purchase or exercise price or any performance
      objective with respect to any Award; provided, however, that the number
      of Shares or other securities covered by any Award or to which such
      Award relates is always a whole number. Notwithstanding the foregoing,
      the foregoing adjustments shall be made in compliance with:
      (i) Sections 422 and 424 of the Code with respect to ISOs; (ii) Treasury
      Department Regulation Section 1.424-1 (and any successor) with respect
      to NQSOs, applied as if the NQSOs were ISOs; (iii) Section 409A of the
      Code, to the extent necessary to avoid its application or avoid adverse
      tax consequences thereunder; and (iv) Section 162(m) of the Code with
      respect to Awards granted to Section 162(m) Persons that are intended to
      be “performance-based compensation,” unless specifically determined
      otherwise by the Committee.
    

    
      
        

        

      

      
        
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      ARTICLE 4
    

    
      Participants
    

    
           4.1 Eligibility. Officers and all
      other key employees of the Company or any of its Affiliates (each an
      “Eligible Employee”) who are selected by the Committee in its sole
      discretion are eligible to participate in this Plan.
    

    
           4.2 Plan Agreements. Awards are
      contingent upon the participant’s execution of a written agreement in a
      form prescribed by the Committee. Execution of a plan agreement shall
      constitute the participant’s irrevocable agreement to, and acceptance
      of, the terms and conditions of the Award set forth in such agreement
      and of the terms and conditions of the Plan applicable to such Award.
      Plan agreements may differ from time to time and from participant to
      participant.
    

    

    

    
      ARTICLE 5
    

    
      Stock Option Awards
    

    
           5.1 Option Grant. Each Stock Option
      granted under this Plan will be evidenced by minutes of a meeting, or by
      a unanimous written consent without a meeting, of the Committee and by a
      written agreement dated as of the Date of Grant and executed by the
      Company and by the appropriate participant.
    

    
           5.2 Terms and Conditions of Grants.
      Stock Options granted under this Plan are subject to the following terms
      and conditions and may contain such additional terms, conditions,
      restrictions and contingencies with respect to exercisability and/or
      with respect to the Shares acquired upon exercise as may be provided in
      the relevant agreement evidencing the Stock Options, so long as such
      terms and conditions are not inconsistent with the terms of this Plan,
      as the Committee deems desirable:
    

    
                (a) Exercise
      Price. Subject to Section 3.4, the Exercise Price will never be less
      than 100% of the Fair Market Value of the Shares on the Date of Grant.
      If a variable Exercise Price is specified at the time of grant, the
      Exercise Price may vary pursuant to a formula or other method
      established by the Committee; provided, however, that such
      formula or method will provide for a minimum Exercise Price equal to the
      Fair Market Value of the Shares on the Date of Grant. Except as
      otherwise provided in Section 3.4, no subsequent amendment of an
      outstanding Stock Option may reduce the Exercise Price to less than 100%
      of the Fair Market Value of the Shares on the Date of Grant. Nothing in
      this Section 5.2(a) shall be construed as limiting the Committee’s
      authority to grant premium price Stock Options which do not become
      exercisable until the Fair Market Value of the underlying Shares exceeds
      a specified percentage (e.g., 110%) of the Exercise Price; provided,
      however, that such percentage will never be less than 100%.
    

    
                (b) Option
      Term. Any unexercised portion of a Stock Option granted hereunder
      shall expire at the end of the stated term of the Stock Option. The
      Committee may extend the term of a Stock Option, in its discretion, but
      not beyond a date later than the earlier of (i) the latest date upon
      which the Stock Option could have expired by its original terms under
      any circumstances or (ii) the tenth anniversary of the original Date of
      Grant of the Stock Option. If a definite term is not specified by the
      Committee at the time of grant, then the term is deemed to be 10 years.
      Nothing in this Section 5.2(b) shall be construed as limiting the
      Committee’s authority to grant Stock Options with a term shorter than
      10 years.
    

    
      
        

        

      

      
        
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                (c) Vesting.
      Stock Options, or portions thereof, are exercisable at such time or
      times as determined by the Committee in its discretion at or after
      grant. The Committee may provide that a vesting schedule shall be
      specified in a plan agreement. If the Committee provides that any Stock
      Option becomes Vested over a period of time, in full or in installments,
      the Committee may waive or accelerate such Vesting provisions at any
      time.
    

    
                (d) Method
      of Exercise. Vested portions of any Stock Option may be exercised in
      whole or in part at any time during the option term by giving written
      notice of exercise to the Company specifying the number of Shares to be
      purchased. The notice must be given by or on behalf of a person entitled
      to exercise the Stock Option, accompanied by payment in full of the
      Exercise Price, along with any tax withholding pursuant to Article 15.
      Subject to the approval of the Committee, the Exercise Price may be paid:
    

    
    	
           
        	
          (i)
        	
          in cash in any manner satisfactory to the Committee;
        
	

        	

        	
           
        
	

        	
          (ii)
        	
          by tendering (by either actual delivery of Shares or by attestation)
          unrestricted Shares that are owned on the date of exercise by the
          person entitled to exercise the Stock Option having an aggregate
          Fair Market Value on the date of exercise equal to the Exercise
          Price applicable to such Stock Option exercise, and, with respect to
          the exercise of NQSOs, including restricted Shares;
        
	

        	

        	
           
        
	

        	
          (iii)
        	
          by a combination of cash and unrestricted Shares that are owned on
          the date of exercise by the person entitled to exercise the Stock
          Option; and
        
	

        	

        	
           
        
	

        	
          (iv)
        	
          by another method permitted by law and affirmatively approved by the
          Committee which assures full and immediate payment or satisfaction
          of the Exercise Price.
        

    

    
           The Committee may withhold its approval for any method of payment
      for any reason, in its sole discretion, including but not limited to
      concerns that the proposed method of payment will result in adverse
      financial accounting treatment, adverse tax treatment for the Company or
      a participant or a violation of the Sarbanes-Oxley Act of 2002, as
      amended from time to time, and related regulations and guidance.
    

    
                (e) Limitation
      on Gain. To the extent it would not trigger adverse taxation under
      Code Section 409A, nothing in this Article 5 shall be construed as
      prohibiting the Committee from granting Stock Options subject to a limit
      on the gain that may be realized upon exercise of such Stock Options.
      Any such limit shall be explicitly provided for in the relevant plan
      agreement.
    

    
                (f) Form.
      Unless the grant of a Stock Option is designated at the time of grant as
      an ISO, it is deemed to be an NQSO. ISOs are subject to the additional
      terms and conditions in Article 6.
    

    
                (g) Special
      Limitations on Stock Option Awards. Unless an Award agreement
      approved by the Committee provides otherwise, Stock Options awarded
      under this Plan are intended to meet the requirements for exclusion from
      coverage under Code Section 409A and all Stock Option Awards shall be
      construed and administered accordingly.
    

    
      
        

        

      

      
        
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           5.3 Termination of Grants Prior to
      Expiration. Subject to Article 6 with respect to ISOs, if the
      employment of an optionee with the Company or its Affiliates terminates
      for any reason, all unexercised Stock Options may be exercised only in
      accordance with rules established by the Committee or as specified in
      the relevant agreement evidencing the Stock Options. Such rules may
      provide, as the Committee deems appropriate, for the expiration,
      continuation, or acceleration of the vesting of all or part of the Stock
      Options.
    

    

    

    
      ARTICLE 6
    

    
      Special Rules Applicable to Incentive Stock Options
    

    
           6.1 Eligibility. Notwithstanding
      any other provision of this Plan to the contrary, an ISO may only be
      granted to full or part-time employees (including officers) of the
      Company or of an Affiliate, provided that the Affiliate is a Parent or
      Subsidiary.
    

    
           6.2 Special ISO Rules.
    

    
                (a) Term.
      No ISO may be exercisable on or after the tenth anniversary of the Date
      of Grant, and no ISO may be granted under this Plan on or after the
      tenth anniversary of the effective date of this Plan.
    

    
                (b) Ten
      Percent Shareholder. No grantee may receive an ISO under this Plan
      if such grantee, at the time the Award is granted, owns (after
      application of the rules contained in Section 424(d) of the Code) equity
      securities possessing more than 10% of the total combined voting power
      of all classes of equity securities of the Company, its Parent or any
      Subsidiary, unless (i) the option price for such ISO is at least 110% of
      the Fair Market Value of the Shares as of the Date of Grant, and
      (ii) such ISO is not exercisable on or after the fifth anniversary of
      the Date of Grant.
    

    
                (c) Limitation
      on Grants. The aggregate Fair Market Value (determined with respect
      to each ISO at the time of grant) of the Shares with respect to which
      ISOs are exercisable for the first time by a grantee during any calendar
      year (under this Plan or any other plan adopted by the Company or its
      Parent or its Subsidiary) shall not exceed $100,000. If such aggregate
      Fair Market Value shall exceed $100,000, such number of ISOs as shall
      have an aggregate Fair Market Value equal to the amount in excess of
      $100,000 shall be treated as NQSOs.
    

    
                (d) Non-Transferability.
      Notwithstanding any other provision herein to the contrary, no ISO
      granted hereunder (and, if applicable, related Stock Appreciation Right)
      may be transferred except by will or by the laws of descent and
      distribution, nor may such ISO (or related Stock Appreciation Right) be
      exercisable during a grantee’s lifetime other than by him (or his
      guardian or legal representative to the extent permitted by applicable
      law).
    

    
                (e) Termination
      of Employment. No ISO may be exercised more than three months
      following termination of employment for any reason (including
      retirement) other than death or disability, nor more than one year
      following termination of employment for the reason of death or
      disability (as defined in Section 422 of the Code), or such option will
      no longer qualify as an ISO and shall thereafter be, and receive the tax
      treatment applicable to, an NQSO. For this purpose, a termination of
      employment is cessation of employment such that no employment
      relationship exists between the participant and the Company, a Parent or
      a Subsidiary.
    

    
      
        

        

      

      
        
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                (f) Fair
      Market Value. For purposes of any ISO granted hereunder (or, if
      applicable, related Stock Appreciation Right), the Fair Market Value of
      Shares shall be determined in the manner required by Section 422 of the
      Code.
    

    
           6.3 Subject to Code Amendments. The
      foregoing limitations are designed to comply with the requirements of
      Section 422 of the Code and shall be automatically amended or modified
      to comply with amendments or modifications to Section 422 of the Code.
      Any ISO which fails to comply with Section 422 of the Code is
      automatically treated as an NQSO appropriately granted under this Plan
      provided it otherwise meets the Plan’s requirements for NQSOs.
    

    

    

    
      ARTICLE 7
    

    
      Stock Appreciation Rights
    

    
           7.1 SAR Grant and Agreement. Stock
      Appreciation Rights may be granted under this Plan, either independently
      or in conjunction with the grant of a Stock Option. Each SAR granted
      under this Plan will be evidenced by minutes of a meeting, or by a
      unanimous written consent without a meeting, of the Committee and by a
      written agreement dated as of the Date of Grant and executed by the
      Company and by the appropriate participant.
    

    
           7.2 SARs Granted in Conjunction with
      Option. Stock Appreciation Rights may be granted in conjunction
      with, and at the same time as, all or part of any Stock Option granted
      under this Plan and will be subject to the following terms and
      conditions:
    

    
                (a) Term.
      Each Stock Appreciation Right, or applicable portion thereof, granted
      with respect to a given Stock Option or portion thereof terminates and
      is no longer exercisable upon the termination or exercise of the related
      Stock Option, or applicable portion thereof.
    

    
                (b) Exercisability.
      A Stock Appreciation Right is exercisable only at such time or times and
      to the extent that the Stock Option to which it relates is Vested and
      exercisable in accordance with the provisions of Article 5 or otherwise
      as the Committee may determine at or after the time of grant.
    

    
                (c) Method
      of Exercise. A Stock Appreciation Right may be exercised by the
      surrender of the applicable portion of the related Stock Option. Stock
      Options which have been so surrendered, in whole or in part, are no
      longer exercisable to the extent the related Stock Appreciation Rights
      have been exercised and are deemed to have been exercised for the
      purpose of the limitation set forth in Article 3 on the number of Shares
      to be issued under this Plan, but only to the extent of the number of
      Shares actually issued under the Stock Appreciation Right at the time of
      exercise. Upon the exercise of a Stock Appreciation Right, subject to
      satisfaction of the tax withholding requirements pursuant to Article 15,
      the holder of the Stock Appreciation Right is entitled to receive Shares
      or cash (as determined in the Award agreement) equal in value to the
      excess of the Fair Market Value of a Share on the exercise date over the
      Exercise Price per Share specified in the related Stock Option,
      multiplied by the number of Shares in respect of which the Stock
      Appreciation Right is exercised. At any time the Exercise Price per
      Share of the related Stock Option exceeds the Fair Market Value of one
      Share, the holder of the Stock Appreciation Right shall not be permitted
      to exercise such right.
    

    
      
        

        

      

      
        
          10
        

        
          

        

      

      
        

        

      

    

    
           7.3 Independent SARs. Stock
      Appreciation Rights may be granted without related Stock Options, and
      independent Stock Appreciation Rights will be subject to the following
      terms and conditions:
    

    
                (a) Term.
      Any unexercised portion of an independent Stock Appreciation Right
      granted hereunder shall expire at the end of the stated term of the
      Stock Appreciation Right. The Committee shall determine the term of each
      Stock Appreciation Right at the time of grant, which term shall not
      exceed 10 years from the Date of Grant. The Committee may extend the
      term of a Stock Appreciation Right, in its discretion, but not beyond a
      date later than the earlier of (i) the latest date upon which the Stock
      Appreciation Right could have expired by its original terms under any
      circumstances or (ii) the tenth anniversary of the original Date of
      Grant of the Stock Appreciation Right. If a definite term is not
      specified by the Committee at the time of grant, then the term is deemed
      to be 10 years.
    

    
                (b) Exercisability.
      A Stock Appreciation Right is exercisable, in whole or in part, at such
      time or times as determined by the Committee at or after the time of
      grant.
    

    
                (c) Exercise
      Price. Subject to Section 3.4, the Exercise Price of an independent
      Stock Appreciation Right will never be less than 100% of the Fair Market
      Value of the related Shares on the Date of Grant. If a variable Exercise
      Price is specified at the time of grant, the Exercise Price may vary
      pursuant to a formula or other method established by the Committee; provided,
      however, that such formula or method will provide for a minimum
      Exercise Price equal to the Fair Market Value of the Shares on the Date
      of Grant. Except as otherwise provided in Section 3.4, no subsequent
      amendment of an outstanding Stock Appreciation Right may reduce the
      Exercise Price to less than 100% of the Fair Market Value of the Shares
      on the Date of Grant. Nothing in this Section 7.3(c) shall be construed
      as limiting the Committee’s authority to grant premium price Stock
      Appreciation Rights which do not become exercisable until the Fair
      Market Value of the related Shares exceeds a specified percentage (e.g.,
      110%) of the Exercise Price; provided, however, that such
      percentage will never be less than 100%.
    

    
                (d) Method
      of Exercise. A Stock Appreciation Right may be exercised in whole or
      in part during the term by giving written notice of exercise to the
      Company specifying the number of Shares in respect of which the Stock
      Appreciation Right is being exercised. The notice must be given by or on
      behalf of a person entitled to exercise the Stock Appreciation Right.
      Upon the exercise of a Stock Appreciation Right, subject to satisfaction
      of the tax withholding requirements pursuant to Article 15, the holder
      of the Stock Appreciation Right is entitled to receive Shares or cash
      (as determined in the Award agreement) equal in value to the excess of
      the Fair Market Value of a Share on the exercise date over the Exercise
      Price of the SAR multiplied by the number of Stock Appreciation Rights
      being exercised. At any time the Fair Market Value of a Share on a
      proposed exercise date does not exceed the Exercise Price of the SAR,
      the holder of the Stock Appreciation Right shall not be permitted to
      exercise such right.
    

    
      
        

        

      

      
        
          11
        

        
          

        

      

      
        

        

      

    

    
                (e) Early
      Termination Prior to Expiration. If the employment of an optionee
      with the Company or its Affiliates terminates for any reason, all
      unexercised independent Stock Appreciation Rights may be exercised only
      in accordance with rules established by the Committee or as specified in
      the relevant agreement evidencing such Stock Appreciation Rights. Such
      rules may provide, as the Committee deems appropriate, for the
      expiration, continuation, or acceleration of the vesting of all or part
      of such Stock Appreciation Rights.
    

    
           7.4 Other Terms and Conditions of SAR
      Grants. Stock Appreciation Rights are subject to such other terms
      and conditions, not inconsistent with the provisions of this Plan, as
      are determined from time to time by the Committee.
    

    
           7.5 Special Limitations on SAR Awards.
      Unless an Award agreement approved by the Committee provides otherwise,
      Stock Appreciation Rights awarded under this Plan are intended to meet
      the requirements for exclusion from coverage under Code Section 409A and
      all Stock Appreciation Rights Awards shall be construed and administered
      accordingly.
    

    

    

    
      ARTICLE 8
    

    
      Restricted Share and Restricted Share Unit Awards
    

    
           8.1 Restricted Share Grants and
      Agreements. Restricted Share Awards consist of Shares which are
      issued by the Company to a participant at no cost or at a purchase price
      determined by the Committee which may be below their Fair Market Value
      but which are subject to forfeiture and restrictions on their sale or
      other transfer by the participant. Each Restricted Share Award granted
      under this Plan will be evidenced by minutes of a meeting, or by a
      unanimous written consent without a meeting, of the Committee and by a
      written agreement dated as of the Date of Grant and executed by the
      Company and by the participant. The timing of Restricted Share Awards
      and the number of Shares to be issued (subject to Section 3.2) are to be
      determined by the Committee in its discretion. By accepting a grant of
      Restricted Shares, the participant consents to any tax withholding as
      provided in Article 15.
    

    
           8.2 Terms and Conditions of Restricted
      Share Grants. Restricted Shares granted under this Plan are subject
      to the following terms and conditions, which, except as otherwise
      provided herein, need not be the same for each participant, and may
      contain such additional terms, conditions, restrictions and
      contingencies not inconsistent with the terms of this Plan and any
      operative employment or other agreement, as the Committee deems
      desirable:
    

    
                (a) Purchase
      Price. The Committee shall determine the prices, if any, at which
      Restricted Shares are to be issued to a participant, which may vary from
      time to time and from participant to participant and which may be below
      the Fair Market Value of such Restricted Shares at the Date of Grant.
    

    
      
        

        

      

      
        
          12
        

        
          

        

      

      
        

        

      

    

    
                (b) Restrictions.
      All Restricted Shares issued under this Plan will be subject to such
      restrictions as the Committee may determine, which may include, without
      limitation, the following:
    

    
    	
           
        	
          (i)
        	
          a prohibition against the sale, transfer, pledge or other
          encumbrance of the Restricted Shares, such prohibition to lapse at
          such time or times as the Committee determines (whether in
          installments or otherwise, but subject to the Change in Control
          provisions in Article 11);
        
	

        	

        	
           
        
	

        	
          (ii)
        	
          a requirement that the participant forfeit such Restricted Shares in
          the event of termination of the participant’s employment with the
          Company or its Affiliates prior to Vesting;
        
	

        	

        	
           
        
	

        	
          (iii)
        	
          a prohibition against employment or retention of the participant by
          any competitor of the Company or its Affiliates, or against
          dissemination by the participant of any secret or confidential
          information belonging to the Company or an Affiliate;
        
	

        	

        	
           
        
	

        	
          (iv)
        	
          any applicable requirements arising under the Securities Act of
          1933, as amended, other securities laws, the rules and regulations
          of The Nasdaq Stock Market or any other stock exchange or
        
	

        	

        	
           
        
	

        	

        	
          transaction reporting system upon which such Restricted Shares are
          then listed or quoted and any state laws, rules and regulations,
          including “blue sky” laws; and
        
	

        	

        	
           
        
	

        	
          (v)
        	
          such additional restrictions as are required to avoid adverse tax
          consequences under Code Section 409A.
        

    

    
      The Committee may at any time waive such restrictions or accelerate the
      date or dates on which the restrictions will lapse. However, if the
      Committee determines that restrictions lapse upon the attainment of
      specified performance objectives, then the provisions of Sections 9.2
      and 9.3 will apply. If the written agreement governing an Award to a
      Section 162(m) Person provides that such Award is intended to be
      “performance-based compensation,” the provisions of Section 9.4(d) will
      also apply.
    

    
                (c) Delivery
      of Shares. Restricted Shares will be registered in the name of the
      participant and deposited, together with a Stock Power, with the
      Company. Each such certificate will bear a legend in substantially the
      following form:
    

    
      “The transferability of this certificate and the Common Shares
      represented by it are subject to the terms and conditions (including
      conditions of forfeiture) contained in the LNB Bancorp, Inc. 2006 Stock
      Incentive Plan and an agreement entered into between the registered
      owner and the Company. A copy of this Plan and agreement are on file in
      the office of the Secretary of the Company.”
    

    
      At the end of any time period during which the Restricted Shares are
      subject to forfeiture and restrictions on transfer, and after any tax
      withholding, such Shares will be delivered free of all restrictions
      (except for any pursuant to Article 14) to the participant or other
      appropriate person and with the foregoing legend removed.
    

    
      
        

        

      

      
        
          13
        

        
          

        

      

      
        

        

      

    

    
                (d) Forfeiture
      of Shares. If a participant who holds Restricted Shares fails to
      satisfy the restrictions, vesting requirements and other conditions
      relating to the Restricted Shares prior to the lapse, satisfaction or
      waiver of such restrictions and conditions, except as may otherwise be
      determined by the Committee, the participant shall forfeit the Shares
      and transfer them back to the Company in exchange for a refund of any
      consideration paid by the participant or such other amount which may be
      specifically set forth in the Award agreement. A participant shall
      execute and deliver to the Company one or more Stock Powers with respect
      to Restricted Shares granted to such participant.
    

    
                (e) Voting
      and Other Rights. Except as otherwise required for compliance with
      Section 162(m) of the Code and the terms of the applicable Restricted
      Share Agreement, during any period in which Restricted Shares are
      subject to forfeiture and restrictions on transfer, the participant
      holding such Restricted Shares shall have all the rights of a
      Shareholder with respect to such Shares, including, without limitation,
      the right to vote such Shares and the right to receive any dividends
      paid with respect to such Shares.
    

    
           8.3 Restricted Share Unit Awards and
      Agreements. Restricted Share Unit Awards consist of Shares that will
      be issued to a participant at a future time or times at no cost or at a
      purchase price determined by the Committee which may be below their Fair
      Market Value if continued employment and/or other terms and conditions
      specified by the Committee are satisfied. Each Restricted Share Unit
      Award granted under this Plan will be evidenced by minutes of a meeting,
      or by a unanimous written consent without a meeting, of the Committee
      and by a written agreement dated as of the Date of Grant and executed by
      the Company and the Plan participant. The timing of Restricted Share
      Unit Awards and the number of Restricted Share Units to be awarded
      (subject to Section 3.2) are to be determined by the Committee in its
      sole discretion. By accepting a Restricted Share Unit Award, the
      participant agrees to remit to the Company when due any tax withholding
      as provided in Article 15.
    

    
           8.4 Terms and Conditions of Restricted
      Share Unit Awards. Restricted Share Unit Awards are subject to the
      following terms and conditions, which, except as otherwise provided
      herein, need not be the same for each participant, and may contain such
      additional terms, conditions, restrictions and contingencies not
      inconsistent with the terms of this Plan and any operative employment or
      other agreement, as the Committee deems desirable:
    

    
                (a) Purchase
      Price. The Committee shall determine the prices, if any, at which
      Shares are to be issued to a participant after Vesting of Restricted
      Share Units, which may vary from time to time and among participants and
      which may be below the Fair Market Value of Shares at the Date of Grant.
    

    
                (b) Restrictions.
      All Restricted Share Units awarded under this Plan will be subject to
      such restrictions as the Committee may determine, which may include,
      without limitation, the following:
    

    
    	
           
        	
          (i)
        	
          a prohibition against the sale, transfer, pledge or other
          encumbrance of the Restricted Share Unit;
        
	

        	

        	
           
        
	

        	
          (ii)
        	
          a requirement that the participant forfeit such Restricted Share
          Unit in the event of termination of the participant’s employment
          with the Company or its Affiliates prior to Vesting;
        

    

    

    

    
      
        

        

      

      
        
          14
        

        
          

        

      

      
        

        

      

    

    
    	
           
        	
          (iii)
        	
          a prohibition against employment of the participant by, or provision
          of services by the participant to, any competitor of the Company or
          its Affiliates, or against dissemination by the participant of any
          secret or confidential information belonging to the Company or an
          Affiliate;
        
	

        	

        	
           
        
	

        	
          (iv)
        	
          any applicable requirements arising under the Securities Act of
          1933, as amended, other securities laws, the rules and regulations
          of The Nasdaq Stock Market or any other stock exchange or
          transaction reporting system upon which the Common Shares are then
          listed or quoted and any state laws, rules and interpretations,
          including “blue sky” laws; and
        
	

        	

        	
           
        
	

        	
          (v)
        	
          such additional restrictions as are required to avoid adverse tax
          consequences under Code Section 409A.
        

    

    
      The Committee may at any time waive such restrictions or accelerate the
      date or dates on which the restrictions will lapse.
    

    
                (c) Performance-Based
      Restrictions. The Committee may, in its sole discretion, provide
      restrictions that lapse upon the attainment of specified performance
      objectives. In such case, the provisions of Sections 9.2 and 9.3 will
      apply (including, but not limited to, the enumerated performance
      objectives). If the written agreement governing an Award to a Section
      162(m) Person provides that such Award is intended to be
      “performance-based compensation,” the provisions of Section 9.4(d) will
      also apply.
    

    
                (d) Voting
      and Other Rights. A participant holding Restricted Share Units shall
      not be deemed to be a Shareholder solely because of such units. Such
      participant shall have no rights of a Shareholder with respect to such
      units; provided, however, that an Award agreement may provide for
      payment of an amount of money (or Shares with a Fair Market Value
      equivalent to such amount) equal to the dividends paid from time to time
      on the number of Common Shares that would become payable upon vesting of
      a Restricted Share Unit Award.
    

    
                (e) Lapse
      of Restrictions. If a participant who holds Restricted Share Units
      satisfies the restrictions and other conditions relating to the
      Restricted Share Units prior to the lapse or waiver of such restrictions
      and conditions, the Restricted Share Units shall be converted to, or
      replaced with, Shares which are free of all restrictions except for any
      restrictions pursuant to Article 14.
    

    
                (f) Forfeiture
      of Restricted Share Units. If a participant who holds Restricted
      Share Units fails to satisfy the restrictions, Vesting requirements and
      other conditions relating to the Restricted Share Units prior to the
      lapse, satisfaction or waiver of such restrictions and conditions,
      except as may otherwise be determined by the Committee, the participant
      shall forfeit the Restricted Share Units.
    

    
                (g) Termination.
      A Restricted Share Unit Award or unearned portion thereof will terminate
      without the issuance of Shares on the termination date specified on the
      Date of Grant or upon the termination of employment of the participant
      during the time period or periods specified by the Committee during
      which any performance objectives must be met (the “Performance Period”).
      If a participant’s employment with the Company or its Affiliates
      terminates by reason of his or her death, disability or retirement, the
      Committee in its discretion at or after the Date of Grant may determine
      that the participant (or the heir, legatee or legal representative of
      the participant’s estate) will receive a distribution of Shares in an
      amount which is not more than the number of Shares which would have been
      earned by the participant if 100% of the performance objectives for the
      current Performance Period had been achieved prorated based on the ratio
      of the number of months of active employment in the Performance Period
      to the total number of months in the Performance Period. However, with
      respect to Awards intended to be performance-based compensation (as
      described in Section 9.4(d)), distribution of the Shares shall not be
      made prior to attainment of the relevant performance objectives.
    

    
      
        

        

      

      
        
          15
        

        
          

        

      

      
        

        

      

    

    
           8.5  Special Limitations on
      Restricted Share and Restricted Share Unit Awards. Unless an Award
      agreement approved by the Committee provides otherwise, Restricted
      Shares and Restricted Share Units awarded under this Plan are intended
      to meet the requirements for exclusion from coverage under Code
      Section 409A and all Restricted Share Unit Awards shall be construed and
      administered accordingly.
    

    
           8.6 Time Vesting of Restricted Share
      and Restricted Share Unit Awards. Restricted Shares or Restricted
      Share Units, or portions thereof, are exercisable at such time or times
      as determined by the Committee in its discretion at or after grant,
      subject to the restrictions on time Vesting set forth in this Section.
      If the Committee provides that any Restricted Shares or Restricted Share
      Unit Awards become Vested over time (with or without a performance
      component), the Committee may waive or accelerate such Vesting
      provisions at any time, subject to the restrictions on time Vesting set
      forth in this Section.
    

    

    

    
      ARTICLE 9
    

    
      Performance Share Awards
    

    
           9.1 Performance Share Awards and
      Agreements. A Performance Share Award is a right to receive Shares
      in the future conditioned upon the attainment of specified performance
      objectives and such other conditions, restrictions and contingencies as
      the Committee may determine. Each Performance Share Award granted under
      this Plan will be evidenced by minutes of a meeting, or by a unanimous
      written consent without a meeting, of the Committee and by a written
      agreement dated as of the Date of Grant and executed by the Company and
      by the Plan participant. The timing of Performance Share Awards and the
      number of Shares covered by each Award (subject to Section 3.2) are to
      be determined by the Committee in its discretion. By accepting a grant
      of Performance Shares, the participant agrees to remit to the Company
      when due any tax withholding as provided in Article 15.
    

    
           9.2 Performance Objectives. At the
      time of grant of a Performance Share Award, the Committee will specify
      the performance objectives which, depending on the extent to which they
      are met, will determine the number of Shares that will be distributed to
      the participant. The Committee will also specify the time period or
      periods (the “Performance Period”) during which the performance
      objectives must be met. With respect to awards to Section 162(m) Persons
      intended to be “performance based compensation,” the Committee may use
      performance objectives based on one or more of the following: earnings
      per share, total revenue, net interest income, non-interest income, net
      income, net income before tax, non-interest expense, efficiency ratio,
      return on equity, return on assets, economic profit added, loans,
      deposits, tangible equity, assets, net charge-offs, new market growth,
      product line developments, and nonperforming assets. The Committee may
      designate a single goal criterion or multiple goal criteria for
      performance measurement purposes. Performance measurement may be
      described in terms of objectives that are related to the performance by
      the Company, by any Subsidiary, or by any employee or group of employees
      in connection with services performed by that employee or those
      employees for the Company, a Subsidiary, or one or more subunits of the
      Company or of any Subsidiary. The performance objectives may be made
      relative to the performance of other companies. The performance
      objectives and periods need not be the same for each participant nor for
      each Award.
    

    
      
        

        

      

      
        
          16
        

        
          

        

      

      
        

        

      

    

    
           9.3 Adjustment of Performance Objectives.
      The Committee may modify, amend or otherwise adjust the performance
      objectives specified for outstanding Performance Share Awards if it
      determines that an adjustment would be consistent with the objectives of
      this Plan and taking into account the interests of the participants and
      the public Shareholders of the Company and such adjustment complies with
      the requirements of Section 162(m) of the Code for Section 162(m)
      Persons, to the extent applicable, unless the Committee indicates a
      contrary intention. The types of events which could cause an adjustment
      in the performance objectives include, without limitation, accounting
      changes which substantially affect the determination of performance
      objectives, changes in applicable laws or regulations which affect the
      performance objectives, and divisive corporate reorganizations,
      including spin-offs and other distributions of property or stock.
    

    
           9.4 Other Terms and Conditions.
      Performance Share Awards granted under this Plan are subject to the
      following terms and conditions and may contain such additional terms,
      conditions, restrictions and contingencies not inconsistent with the
      terms of this Plan and any operative employment or other agreement as
      the Committee deems desirable:
    

    
                (a) Delivery
      of Shares. As soon as practicable after the applicable Performance
      Period has ended, the participant will receive a distribution of the
      number of Shares earned during the Performance Period, depending upon
      the extent to which the applicable performance objectives were achieved.
      Such Shares will be registered in the name of the participant and will
      be free of all restrictions except for any restrictions pursuant to
      Article 14.
    

    
                (b) Termination.
      A Performance Share Award or unearned portion thereof will terminate
      without the issuance of Shares on the termination date specified at the
      time of grant or upon the termination of employment of the participant
      during the Performance Period. If a participant’s employment with the
      Company or its Affiliates terminates by reason of his or her death,
      disability or retirement (except with respect to Section 162(m)
      Persons), the Committee in its discretion at or after the time of grant
      may determine, notwithstanding any Vesting requirements, that the
      participant (or the heir, legatee or legal representative of the
      participant’s estate) will receive a distribution of a portion of the
      participant’s then-outstanding Performance Share Awards in an amount
      which is not more than the number of shares which would have been earned
      by the participant if 100% of the performance objectives for the current
      Performance Period had been achieved prorated based on the ratio of the
      number of months of active employment in the Performance Period to the
      total number of months in the Performance Period. However, with respect
      to Awards intended to be “performance-based compensation” (as described
      in Section 9.4(d)), distribution of the Shares shall not be made prior
      to attainment of the relevant performance objective.
    

    
      
        

        

      

      
        
          17
        

        
          

        

      

      
        

        

      

    

    
                (c) Voting
      and Other Rights. Awards of Performance Shares do not provide the
      participant with voting rights or rights to dividends prior to the
      participant becoming the holder of record of Shares issued pursuant to
      an Award; provided, however, that an Award agreement may provide
      for payment of an amount of money (or Shares with a Fair Market Value
      equivalent to such amount) equal to the dividends paid from time to time
      on the number of Common Shares that would become payable upon vesting of
      a Performance Share Award. Prior to the issuance of Shares, Performance
      Share Awards may not be sold, transferred, pledged, assigned or
      otherwise encumbered.
    

    
                (d) Performance-Based
      Compensation. The Committee may designate Performance Share Awards
      as being “remuneration payable solely on account of the attainment of
      one or more performance goals” as described in Section 162(m)(4)(C) of
      the Code. Such Awards shall be automatically amended or modified to
      comply with amendments to Section 162 of the Code to the extent
      applicable, unless the Committee indicates a contrary intention.
    

    
           9.5 Time Vesting of Performance Share
      Awards. Performance Share Awards, or portions thereof, are
      exercisable at such time or times as determined by the Committee in its
      discretion at or after grant, subject to the restrictions on time
      Vesting set forth in this Section. If the Committee provides that any
      Performance Shares become Vested over time (accelerated by a performance
      component), the Committee may waive or accelerate such Vesting
      provisions at any time, subject to the restrictions on time Vesting set
      forth in this Section.
    

    
           9.6 Special Limitations on Performance
      Share Awards. Unless an Award agreement approved by the Committee
      provides otherwise, Performance Shares awarded under this Plan are
      intended to meet the requirements for exclusion from coverage under Code
      Section 409A and all Performance Share Awards shall be construed and
      administered accordingly.
    

    

    

    
      ARTICLE 10
    

    
      Transfers and Leaves of Absence
    

    
           10.1 Transfer of Participant. For
      purposes of this Plan, the transfer of a participant among the Company
      and its Affiliates is deemed not to be a termination of employment.
    

    
           10.2 Effect of Leaves of Absence.
      For purposes of this Plan, the following leaves of absence are deemed
      not to be a termination of employment:
    

    
                (a) a leave of absence, approved in writing by the Company,
      for military service, sickness or any other purpose approved by the
      Company, if the period of such leave does not exceed 90 days;
    

    
      
        

        

      

      
        
          18
        

        
          

        

      

      
        

        

      

    

    
                (b) a leave of absence in excess of 90 days, approved in
      writing by the Company, but only if the employee’s right to reemployment
      is guaranteed either by a statute or by contract, and provided that, in
      the case of any such leave of absence, the employee returns to work
      within 30 days after the end of such leave; and
    

    
                (c) subject to the restrictions of Code Section 409A, any
      other absence determined by the Committee in its discretion not to
      constitute a termination of employment.
    

    

    

    
      ARTICLE 11
    

    
      Effect of Change in Control
    

    
           11.1 Change in Control Defined.
      “Change in Control” means the occurrence of any of the following:
    

    
                (a) If individuals who, on the effective date of this Plan,
      constitute the Board of Directors (the “Incumbent Directors”) cease for
      any reason to constitute at least a majority of the Board of Directors;
      provided, however, that:
    

    
    	
           
        	
          (i)
        	
          any person becoming a director subsequent to the effective date of
          this Plan, whose election or nomination for election was approved by
          a vote of at least two-thirds (2/3) of the Incumbent Directors then
          on the Board of Directors (either by a specific vote or by approval
          of the proxy statement of the Company in which such person is named
          as a nominee for director, without written objection by such
          Incumbent Directors to such nomination), shall be deemed to be an
          Incumbent Director, and
        
	

        	

        	
           
        
	

        	
          (ii)
        	
          no individual elected or nominated as a director of the Company
          initially as a result of an actual or threatened election contest
          with respect to directors or any other actual or threatened
          solicitation of proxies by or on behalf of any person other than the
          Board of Directors shall be deemed to be an Incumbent Director;
        

    

    
                (b) If any “person” (as such term is defined in
      Section 3(a)(9) of the Exchange Act, and as used in Sections 13(d)(3)
      and 14(d)(2) of the Exchange Act) is or becomes a “beneficial owner” (as
      defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
      of securities of the Company representing twenty percent (20%) or more
      of the combined voting power of the Company’s then-outstanding
      securities eligible to vote for the election of the Board of Directors
      (the “Company Voting Securities”); provided, however, that the events
      described in this paragraph (b) shall not be deemed to be a Change in
      Control by virtue of any of the following acquisitions of Company Voting
      Securities:
    

    
    	
           
        	
          (i)
        	
          by the Company or any Subsidiary,
        
	

        	

        	
           
        
	

        	
          (ii)
        	
          by any employee benefit plan sponsored or maintained by the Company
          or any Subsidiary or by any employee stock benefit trust created by
          the Company or any Subsidiary,
        

    

    
      
        

        

      

      
        
          19
        

        
          

        

      

      
        

        

      

    

    
    	
           
        	
          (iii)
        	
          by any underwriter temporarily holding securities pursuant to an
          offering of such securities,
        
	

        	

        	
           
        
	

        	
          (iv)
        	
          pursuant to a Non-Qualifying Transaction (as defined in paragraph
          (c), below), or
        
	

        	

        	
           
        
	

        	
          (v)
        	
          a transaction (other than one described in paragraph (c), below) in
          which Company Voting Securities are acquired from the Company, if a
          majority of the Incumbent Directors approves a resolution providing
          expressly that the acquisition pursuant to this subparagraph (v)
          does not constitute a Change in Control under this paragraph (b);
        

    

    
                (c) The consummation of a merger, consolidation, share
      exchange or similar form of corporate transaction involving the Company
      or any of its Subsidiaries that requires the approval of the Company’s
      shareholders, whether for such transaction or the issuance of securities
      in the transaction (a “Business Combination”), unless immediately
      following such Business Combination:
    

    
    	
           
        	
          (i)
        	
          more than fifty percent (50%) of the total voting power of either
          (x) the corporation resulting from the consummation of such Business
          Combination (the “Surviving Corporation”) or, if applicable, (y) the
          ultimate parent corporation that directly or indirectly has
          beneficial ownership of one hundred percent (100%) of the voting
          securities eligible to elect directors of the Surviving Corporation
          (the “Parent Corporation”) is represented by Company Voting
          Securities that were outstanding immediately prior to such Business
          Combination (or, if applicable, represented by shares into which
          such Company Voting Securities were converted pursuant to such
          Business Combination), and such voting power among the holders
          thereof is in substantially the same proportion as the voting power
          of such Company Voting Securities among the holders thereof
          immediately prior to the Business Combination,
        
	

        	

        	
           
        
	

        	
          (ii)
        	
          no person (other than any employee benefit plan sponsored or
          maintained by the Surviving Corporation or the Parent Corporation or
          any employee stock benefit trust created by the Surviving
          Corporation or the Parent Corporation) is or becomes the beneficial
          owner, directly or indirectly, of twenty percent (20%) or more of
          the total voting power of the outstanding voting securities eligible
          to elect directors of the Parent Corporation (or, if there is no
          Parent Corporation, the Surviving Corporation), and
        
	

        	

        	
           
        
	

        	
          (iii)
        	
          at least a majority of the members of the board of directors of the
          Parent Corporation (or, if there is no Parent Corporation, the
          Surviving Corporation) were Incumbent Directors at the time of the
          Board of Director’s approval of the execution of the initial
          agreement providing for such Business Combination (any Business
          Combination which satisfies all of the criteria specified in (i),
          (ii) and (iii) of this Section 11.1(c) shall be deemed to be a
          “Non-Qualifying Transaction”); or
        

    

    
                (d) If the shareholders of the Company approve a plan of
      complete liquidation or dissolution of the Company or a sale of all or
      substantially all of the Company’s assets but only if, pursuant to such
      liquidation or sale, the assets of the Company are transferred to an
      entity not owned (directly or indirectly) by the Company’s shareholders.
    

    
      
        

        

      

      
        
          20
        

        
          

        

      

      
        

        

      

    

    
      Notwithstanding the foregoing, a Change in Control shall not be deemed
      to occur solely because any person acquires beneficial ownership of more
      than twenty percent (20%) of Company Voting Securities as a result of
      the acquisition of Company Voting Securities by the Company which
      reduces the number of Company Voting Securities outstanding; provided,
      however, that if (after such acquisition by the Company) such person
      becomes the beneficial owner of additional Company Voting Securities
      that increases the percentage of outstanding Company Voting Securities
      beneficially owned by such person, a Change in Control shall then occur.
    

    
           11.2 Effect of Change in Control.
      In the event of a Change in Control of the Company, the Committee shall
      have the right, in its sole discretion, to:
    

    
                (a) accelerate the exercisability of any or all Stock Options
      or SARs, notwithstanding any limitations set forth in the Plan or Award
      agreement;
    

    
                (b) accelerate the Vesting of Restricted Shares,
      notwithstanding any limitations set forth in the Plan or Award agreement;
    

    
                (c) subject to Code Section 409A, accelerate the Vesting of
      Restricted Share Units and Performance Shares (or, if such Restricted
      Share Units or Performance Shares are subject to performance-based
      restrictions, they shall become Vested on a pro-rated basis as described
      in Section 9.4(b));
    

    
                (d) to the extent it would not trigger adverse taxation under
      Code Section 409A, cancel any or all outstanding Stock Options, SARs,
      Restricted Share Units and Performance Shares in exchange for fair
      value, which, in the case of Stock Options and Stock Appreciation
      Rights, shall equal the excess, if any, of the value of the
      consideration to be paid in the Change in Control transaction to holders
      of the same number of Shares subject to such Stock Options or Stock
      Appreciation Rights (or, if no consideration is paid in any such
      transaction, the Fair Market Value of the Shares subject to such Stock
      Options or Stock Appreciation Rights as of the date of the Change in
      Control) over the aggregate Exercise Price of such Stock Options or
      Stock Appreciation Rights;
    

    
                (e) to the extent it would not trigger adverse taxation under
      Code Section 409A, provide for the issuance of substitute Awards that
      will substantially preserve the otherwise applicable terms and value of
      any affected Awards previously granted hereunder as determined by the
      Committee; or
    

    
                (f) take such other action as it deems appropriate to preserve
      the value of the Award to the Participant.
    

    
      The Committee may provide for any of the foregoing in an Award agreement
      governing an Award in advance, may provide for any of the foregoing in
      connection with a Change in Control, or do both. Alternatively, the
      Committee shall also have the right to require any purchaser of the
      Company’s assets or stock, as the case may be, to take any of the
      actions set forth in the preceding sentence as such purchaser may
      determine to be appropriate or desirable.
    

    
      
        

        

      

      
        
          21
        

        
          

        

      

      
        

        

      

    

    
           The manner of application and interpretation of the foregoing
      provisions of this Section 11.2 shall be determined by the Committee in
      its sole and absolute discretion.
    

    
           11.3 Code Section 409A. Unless
      an Award agreement approved by the Committee provides otherwise, each
      Award granted under this Plan is intended to meet the requirements for
      exclusion from coverage under Code Section 409A. If the Committee
      provides that an Award shall be subject to Code Section 409A, then,
      notwithstanding the other provisions of this Article 11, the Committee
      may provide in the Award agreement for such changes to the definition of
      Change in Control from the definition set forth in this Article 11, and
      for such changes to the Committee’s rights upon a Change in Control, as
      the Committee may deem necessary in order for such Award to comply with
      Code Section 409A.
    

    

    

    
      ARTICLE 12
    

    
      Transferability of Awards
    

    
           12.1 Awards Are Non-Transferable.
      Except as provided in Sections 12.2 and 12.3, Awards are
      non-transferable and any attempts to assign, pledge, hypothecate or
      otherwise alienate or encumber (whether by operation of law or
      otherwise) any Award shall be null and void.
    

    
           12.2 Inter-Vivos Exercise of Awards.
      During a participant’s lifetime, Awards are exercisable only by the
      participant or, as permitted by applicable law and notwithstanding
      Section 12.1 to the contrary, the participant’s guardian or other legal
      representative.
    

    
           12.3 Limited Transferability of Certain
      Awards. Notwithstanding Section 12.1 to the contrary, Awards may be
      transferred by will and by the laws of descent and distribution.
      Moreover, the Committee, in its discretion, may allow at or after the
      time of grant the transferability of Awards which are Vested, provided
      that the permitted transfer is made (a) if the Award is an Incentive
      Stock Option, the transfer is consistent with Section 422 of the Code;
      (b) to the Company (for example in the case of forfeiture of Restricted
      Shares), an Affiliate or a person acting as the agent of the foregoing
      or which is otherwise determined by the Committee to be in the interests
      of the Company; or (c) by the participant for no consideration to
      Immediate Family Members or to a bona fide trust, partnership or other
      entity controlled by and for the benefit of one or more Immediate Family
      Members. “Immediate Family Members” means the participant’s spouse,
      children, stepchildren, parents, stepparents, siblings (including half
      brothers and sisters), in-laws and other individuals who have a
      relationship to the participant arising because of a legal adoption. No
      transfer may be made to the extent that transferability would cause Form
      S-8 or any successor form thereto not to be available to register Shares
      related to an Award. The Committee in its discretion may impose
      additional terms and conditions upon transferability.
    

    
      
        

        

      

      
        
          22
        

        
          

        

      

      
        

        

      

    

    

    

    
      ARTICLE 13
    

    
      Amendment and Discontinuation
    

    
           13.1 Amendment or Discontinuation of
      this Plan. The Board of Directors may amend, alter, or discontinue
      this Plan at any time, provided that no amendment, alteration, or
      discontinuance may be made:
    

    
                (a) which would materially and adversely affect the rights of
      a participant under any Award granted prior to the date such action is
      adopted by the Board of Directors without the participant’s written
      consent thereto; and
    

    
                (b) without shareholder approval, if shareholder approval is
      required under applicable laws, regulations or exchange requirements
      (including Section 422 of the Code with respect to ISOs, and for the
      purpose of qualification as “performance-based compensation” under
      Section 162(m) of the Code).
    

    
           Notwithstanding the foregoing, this Plan may be amended without
      affecting participants’ consent to: (i) comply with any law;
      (ii) preserve any intended favorable tax effects for the Company, the
      Plan or participants; or (iii) avoid any unintended unfavorable tax
      effects for the Company, the Plan or participants.
    

    
           13.2 Amendment of Grants. The
      Committee may amend, prospectively or retroactively, the terms of any
      outstanding Award, provided that no such amendment may be inconsistent
      with the terms of this Plan (specifically including the prohibition on
      granting Stock Options or SARs with an Exercise Price less than 100% of
      the Fair Market Value of the Common Shares on the Date of Grant) or
      would materially and adversely affect the rights of any holder without
      his or her written consent.
    

    

    

    
      ARTICLE 14
    

    
      Issuance of Shares and Share Certificates
    

    
           14.1 Issuance of Shares. The
      Company will issue or cause to be issued Shares as soon as practicable
      upon exercise or conversion of an Award that is payable in Shares. No
      Shares will be issued until full payment has been made, to the extent
      payment is required. Until the issuance (as evidenced by the appropriate
      entry on the books of the Company or of a duly authorized transfer agent
      of the Company) of the stock certificate evidencing such Shares, no
      right to vote or receive dividends or any other rights as a shareholder
      will exist with respect to the Shares, notwithstanding the exercise or
      conversion of the Award payable in shares.
    

    
           14.2 Delivery of Share Certificates.
      The Company is not required to issue or deliver any certificates for
      Shares issuable with respect to Awards under this Plan prior to the
      fulfillment of all of the following conditions:
    

    
                (a) payment in full for the Shares and for any tax withholding
      (See Article 15);
    

    
      
        

        

      

      
        
          23
        

        
          

        

      

      
        

        

      

    

    
                (b) completion of any registration or other qualification of
      such Shares under any Federal or state laws or under the rulings or
      regulations of the Securities and Exchange Commission or any other
      regulating body which the Committee in its discretion deems necessary or
      advisable;
    

    
                (c) admission of such Shares to listing on The Nasdaq Stock
      Market or any stock exchange on which the Shares are listed;
    

    
                (d) in the event the Shares are not registered under the
      Securities Act of 1933, qualification as a private placement under said
      Act;
    

    
                (e) obtaining of any approval or other clearance from any
      Federal or state governmental agency which the Committee in its
      discretion determines to be necessary or advisable; and
    

    
                (f) the Committee is fully satisfied that the issuance and
      delivery of Shares under this Plan is in compliance with applicable
      Federal, state or local law, rule, regulation or ordinance or any rule
      or regulation of any other regulating body, for which the Committee may
      seek approval of counsel for the Company.
    

    
           14.3 Applicable Restrictions on Shares.
      Shares issued with respect to Awards may be subject to such stock
      transfer orders and other restrictions as the Committee may determine
      necessary or advisable under any applicable Federal or state securities
      law rules, regulations and other requirements, the rules, regulations
      and other requirements of The Nasdaq Stock Market or any stock exchange
      upon which the Shares are then-listed, and any other applicable Federal
      or state law and will include any restrictive legends the Committee may
      deem appropriate to include.
    

    
           14.4 Book Entry. In lieu of the
      issuance of stock certificates evidencing Shares, the Company may use a
      “book entry” system in which a computerized or manual entry is made in
      the records of the Company to evidence the issuance of such Shares. Such
      Company records are, absent manifest error, binding on all parties.
    

    

    

    
      ARTICLE 15
    

    
      Satisfaction of Tax Liabilities
    

    
           15.1 In General. The Company shall
      withhold any taxes which the Committee determines the Company is
      required by law or required by the terms of this Plan to withhold in
      connection with any payments incident to this Plan. The participant or
      other recipient shall provide the Committee with such additional
      information or documentation as may be necessary for the Company to
      discharge its obligations under this Section. The Company may withhold:
      (a) cash, (b) subject to any limitations under Rule 16b-3, Common Shares
      to be issued, or (c) any combination thereof, in an amount equal to the
      amount which the Committee determines is necessary to satisfy the
      obligation of the Company, a Subsidiary or a Parent to withhold federal,
      state and local income taxes or other amounts incurred by reason of the
      grant or exercise of an Award, its disposition, or the disposition of
      the underlying Common Shares. Alternatively, the Company may require the
      holder to pay to the Company such amounts, in cash, promptly upon demand.
    

    
      
        

        

      

      
        
          24
        

        
          

        

      

      
        

        

      

    

    
           15.2 Withholding from Share
      Distributions. With respect to a distribution in Shares pursuant to
      Restricted Share, Restricted Share Unit or Performance Share Award under
      the Plan, the Committee may cause the Company to sell the fewest number
      of such Shares for the proceeds of such sale to equal (or exceed by not
      more than that actual sale price of a single Share) the Company’s
      required tax withholding relating to such distribution. The Committee
      may withhold the proceeds of such sale for purposes of satisfying such
      tax withholding obligation.
    

    

    

    
      ARTICLE 16
    

    
      General Provisions
    

    
           16.1 No Implied Rights to Awards or
      Employment. No potential participant has any claim or right to be
      granted an Award under this Plan, and there is no obligation of
      uniformity of treatment of participants under this Plan. Neither this
      Plan nor any Award thereunder shall be construed as giving any
      individual any right to continued employment with the Company or any
      Affiliate. The Plan does not constitute a contract of employment, and
      the Company and each Affiliate expressly reserve the right at any time
      to terminate employees free from liability, or any claim, under this
      Plan, except as may be specifically provided in this Plan or in an Award
      agreement.
    

    
           16.2 Other Compensation Plans.
      Nothing contained in this Plan prevents the Board of Directors from
      adopting other or additional compensation arrangements, subject to
      shareholder approval if such approval is required, and such arrangements
      may be either generally applicable or applicable only in specific cases.
    

    
           16.3 Rule 16b-3 Compliance.
      The Plan is intended to comply with all applicable conditions of
      Rule 16b-3 of the Exchange Act, as such rule may be amended from time to
      time (“Rule 16b-3”). All transactions involving any participant subject
      to Section 16(a) of the Exchange Act shall be subject to the conditions
      set forth in Rule 16b-3, regardless of whether such conditions are
      expressly set forth in this Plan. Any provision of this Plan that is
      contrary to Rule 16b-3 does not apply to such participants.
    

    
           16.4 Code Section 162(m) Compliance.
      The Plan is intended to comply with all applicable requirements of
      Section 162(m) of the Code with respect to “performance-based
      compensation” for Section 162(m) Persons. Unless the Committee expressly
      determines otherwise, any provision of this Plan that is contrary to
      such requirements does not apply to such “performance-based
      compensation.”
    

    
           16.5 Successors. All obligations of
      the Company with respect to Awards granted under this Plan are binding
      on any successor to the Company, whether as a result of a direct or
      indirect purchase, merger, consolidation or otherwise of all or
      substantially all of the business and/or assets of the Company.
    

    
           16.6 Severability. In the event any
      provision of this Plan, or the application thereof to any person or
      circumstances, is held illegal or invalid for any reason, the illegality
      or invalidity shall not affect the remaining parts of this Plan, or
      other applications, and this Plan is to be construed and enforced as if
      the illegal or invalid provision had not been included.
    

    
      
        

        

      

      
        
          25
        

        
          

        

      

      
        

        

      

    

    
           16.7 Governing Law. To the extent
      not preempted by Federal law, this Plan and all Award agreements
      pursuant thereto are construed in accordance with and governed by the
      laws of the State of Ohio. This Plan is not intended to be governed by
      the Employee Retirement Income Security Act and shall be so construed
      and administered.
    

    
           16.8 Legal Requirements. No Awards
      shall be granted and the Company shall have no obligation to make any
      payment under the Plan, whether in Shares, cash, or a combination
      thereof, unless such payment is, without further action by the
      Committee, in compliance with all applicable Federal and state laws and
      regulations, including, without limitation, the Code and Federal and
      state securities laws.
    

    

    

    
      ARTICLE 17
    

    
      Effective Date and Term
    

    
           17.1 Effective Date. The effective
      date of this LNB Bancorp, Inc. 2006 Stock Incentive Plan is the date on
      which the shareholders of the Company approve it at a duly held
      shareholders’ meeting.
    

    
           17.2 Termination Date. This Plan
      will continue in effect until midnight on the day before the tenth
      anniversary of the effective date specified in Section 17.1; provided,
      however, that Awards granted on or before that date may extend beyond
      that date.
    

    

    

    
      ARTICLE 18
    

    
      Compliance with Laws
    

    
           18.1  EESA.  To the
      extent that an Eligible Employee and an Award are subject to Section 111
      of the Emergency Economic Stabilization Act of 2008 and any regulations,
      guidance or interpretations that may from time to time be promulgated
      thereunder or any other applicable statute or regulation affecting an
      Eligible Employee’s compensation (“EESA or Other Applicable Law”), then
      any payment of any kind provided for by, or accrued with respect to, the
      Award must comply with EESA or Other Applicable Law, and the Award
      agreement and this Plan shall be interpreted or reformed to so comply.
      If applicable, an Award will be subject to forfeiture or repayment, and
      subject to recovery by the Company, if the Award is based on financial
      statements or other performance metrics that are later determined to be
      materially inaccurate.
    

    
           18.2  Code Section 409A.  In
      addition to the general amendment rights of the Company with respect to
      the Plan, the Company specifically retains the unilateral right (but not
      the obligation) to make, prospectively or retroactively, any amendment
      to this Plan or any related document as it deems necessary or desirable
      to more fully address issues in connection with exemption from (or
      compliance with)  Code Section 409A and other laws.  In no event,
      however, shall this section or any other provisions of this Plan be
      construed to require the Company to provide any gross-up for the tax
      consequences of any provisions of, or payments under, this Plan and the
      Company and its Affiliates shall have no responsibility for tax or legal
      consequences to any participant (or beneficiary) resulting from the
      terms or operation of this Plan.
    

    

    

    
      26Exhibit 10.2
    

    

    

    
      LNB BANCORP, INC.
STOCK APPRECIATION RIGHTS PLAN
    

    
      (Restated as of December 15, 2009)
    

    

    

    
      ARTICLE 1
    

    
      General Purpose of Plan; Definitions
    

    
           1.1 Name and Purposes. The name of
      this Plan is the LNB Bancorp, Inc. Stock Appreciation Rights Plan. The
      purpose of this Plan is to enable LNB Bancorp, Inc. and its Affiliates
      to: (i) attract and retain skilled and qualified officers and key
      employees who are expected to contribute to the Company’s success by
      providing long-term incentive compensation opportunities; (ii) motivate
      participants to achieve the long-term success and growth of the Company;
      and (iii) align the interests of the participants with those of the
      Company’s shareholders. In order to achieve this purpose, this Plan
      provides for the grant of stock appreciation rights related to the
      Company’s Common Shares.
    

    
           1.2 Certain Definitions. Unless the
      context otherwise indicates, the following words used herein shall have
      the following meanings whenever used in this instrument:
    

    
                (a) “Affiliate” means any corporation, partnership, joint
      venture or other entity, directly or indirectly, through one or more
      intermediaries, controlling, controlled by, or under common control with
      the Company within the meaning of Code Section 414(b) or (c).
    

    
                (b) “Board of Directors” mean the Board of Directors of the
      Company, as constituted from time to time.
    

    
                (c) “Code” means the Internal Revenue Code of 1986, as
      amended, and any lawful regulations or guidance promulgated thereunder.
      Whenever reference is made to a specific Internal Revenue Code section,
      such reference shall be deemed to be a reference to any successor
      Internal Revenue Code section or sections with the same or similar
      purpose.
    

    
                (d) “Committee” means the committee administering this Plan as
      provided in Section 2.1.
    

    
                (e) “Common Shares” mean the common shares, $1.00 par value
      per share, of the Company.
    

    
                (f) “Company” means LNB Bancorp, Inc., a corporation organized
      under the laws of the State of Ohio and, except for purposes of
      determining whether a Change in Control has occurred, any corporation or
      entity that is a successor to LNB Bancorp, Inc. or substantially all of
      the assets of LNB Bancorp, Inc. and that assumes the obligations of LNB
      Bancorp, Inc. under this Plan by operation of law or otherwise.
    

    
                (g) “Date of Grant” means the date on which the Committee
      grants an SAR.
    

    
                (h) “Director” means a member of the Board of Directors.
    

    
      
        

        

      

      
        

        

        
          

        

      

      
        

        

      

    

    
                (i) “Eligible Employee” is defined in Article 4.
    

    
                (j) “Exchange Act” means the Securities Exchange Act of 1934,
      as amended, and any lawful regulations or guidance promulgated
      thereunder.
    

    
                (k) “Exercise Price” means the exercise price per Share
      related to a Stock Appreciation Right.
    

    
                (l) “Fair Market Value” means the closing price of a Share as
      reported on The Nasdaq Stock Market, or, if applicable, on any national
      securities exchange or automated quotation system on which the Common
      Shares are principally traded, on the date for which the determination
      of Fair Market Value is made, or, if there are no sales of Common Shares
      on such date, then on the most recent immediately preceding date on
      which there were any sales of Common Shares. If the Common Shares are
      not, or cease to be, traded on The Nasdaq Stock Market or any national
      securities exchange or automated quotation system, the “Fair Market
      Value” of Common Shares shall be determined pursuant to a reasonable
      valuation method prescribed by the Committee. Notwithstanding the
      foregoing, as of any date, the “Fair Market Value” of Common Shares
      shall be determined in a manner consistent with Code Section 409A and
      the guidance then-existing thereunder.
    

    
                (m) “Independent Director” means a Director who meets the
      definitions of the terms “independent director” set forth in The Nasdaq
      Stock Market, Inc. rules and “non-employee director” set forth in
      Rule 16b-3, or any successor definitions adopted by The Nasdaq Stock
      Market, Inc. and Securities and Exchange Commission, respectively, and
      similar requirements under any other applicable laws and regulations.
    

    
                (n) “Plan” means this LNB Bancorp, Inc. Stock Appreciation
      Rights Plan, as amended from time to time.
    

    
                (o) “Rule 16b-3” is defined in Article 11.
    

    
                (p) “Share” or “Shares” mean one or more of the Common Shares.
    

    
                (q) “Stock Appreciation Rights” and “SARs” mean any right to
      receive the appreciation in Fair Market Value of a specified number of
      Shares over a specified Exercise Price pursuant to an award granted
      under this Plan.
    

    
                (r) “Vested” means when the Stock Appreciation Right first
      becomes exercisable for payment. The words “Vest” and “Vesting” have
      meanings correlative to the foregoing.
    

    
      
        

        

      

      
        
          2
        

        
          

        

      

      
        

        

      

    

    

    

    
      ARTICLE 2
    

    
      Administration
    

    
           2.1 Authority and Duties of the
      Committee.
    

    
                (a) The Plan shall be administered by a Committee of at least
      three Directors who are appointed by the Board of Directors. Unless
      otherwise determined by the Board of Directors, the Compensation
      Committee shall serve as the Committee, and all of the members of the
      Committee shall be Independent Directors. Notwithstanding the
      requirement that the Committee consist exclusively of Independent
      Directors, no action or determination by the Committee or an individual
      then considered to be an Independent Director shall be deemed void
      because a member of the Committee or such individual fails to satisfy
      the requirements for being an Independent Director, except to the extent
      required by applicable law.
    

    
                (b) The Committee has the power and authority to grant SARs
      pursuant to the terms of this Plan to Eligible Employees.
    

    
                (c) The Committee has the sole and exclusive authority,
      subject to any limitations specifically set forth in this Plan, to:
    

    
    	
           
        	
          (i)
        	
          select the Eligible Employees to whom SARs are granted;
        
	

        	

        	
           
        
	

        	
          (ii)
        	
          determine the timing of SARs granted;
        
	

        	

        	
           
        
	

        	
          (iii)
        	
          determine the number of Shares relating to each SAR granted
          hereunder;
        
	

        	

        	
           
        
	

        	
          (iv)
        	
          determine the other terms and conditions, not inconsistent with the
          terms of this Plan, of any SAR granted hereunder; such terms and
          conditions include, but are not limited to, the Exercise Price, the
          time or times when Stock Appreciation Rights may be exercised (which
          may be based on performance objectives), any Vesting, acceleration
          or waiver of forfeiture restrictions, any performance criteria
          applicable to an SAR, and any restriction or limitation regarding
          any Stock Appreciation Right, based in each case on such factors as
          the Committee, in its sole discretion, shall determine;
        
	

        	

        	
           
        
	

        	
          (v)
        	
          determine whether any conditions or objectives related to SARs have
          been met;
        
	

        	

        	
           
        
	

        	
          (vi)
        	
          subsequently modify or waive any terms and conditions of SARs, not
          inconsistent with the terms of this Plan;
        
	

        	

        	
           
        
	

        	
          (vii)
        	
          adopt, alter and repeal such administrative rules, guidelines and
          practices governing this Plan as it deems advisable from time to
          time;
        
	

        	

        	
           
        
	

        	
          (viii)
        	
          promulgate such administrative forms as it from time to time deems
          necessary or appropriate for administration of the Plan;
        

    

    
      
        

        

      

      
        
          3
        

        
          

        

      

      
        

        

      

    

    
    	
           
        	
          (ix)
        	
          construe, interpret, administer and implement the terms and
          provisions of this Plan, any SAR and any related agreements;
        
	

        	

        	
           
        
	

        	
          (x)
        	
          correct any defect, supply any omission and reconcile any
          inconsistency in or between the Plan, any SAR and any related
          agreements; and
        
	

        	

        	
           
        
	

        	
          (xi)
        	
          otherwise supervise the administration of this Plan.
        

    

    
                (d) Notwithstanding the foregoing, all decisions made by the
      Committee pursuant to the provisions of this Plan are final and binding
      on all persons, including the Company, its shareholders and
      participants, but may be made by their terms subject to ratification or
      approval by, the Board of Directors, another committee of the Board of
      Directors or shareholders.
    

    
                (e) The Company shall furnish the Committee with such clerical
      and other assistance as is necessary for the performance of the
      Committee’s duties under the Plan.
    

    
           2.2 Delegation of Duties. The
      Committee may delegate ministerial duties to any other person or
      persons, and it may employ attorneys, consultants, accountants or other
      professional advisers for purposes of plan administration at the expense
      of the Company.
    

    
           2.3 Limitation of Liability.
      Members of the Board of Directors, members of the Committee and Company
      employees who are their designees acting under this Plan shall be fully
      protected in relying in good faith upon the advice of counsel and shall
      incur no liability except for gross or willful misconduct in the
      performance of their duties hereunder.
    

    

    

    
      ARTICLE 3
    

    
      Limitations on Total SARs Granted Under the Plan
    

    
           3.1 Total Stock Appreciation Rights
      Limit. Subject to the provisions of this Article, SARs may not be
      granted for more than an aggregate of 50,000 Shares under this Plan.
    

    
           3.2 Participant Limit. SARs may not
      be granted to any participant in any fiscal year for more than a maximum
      of 10,000 Shares under this Plan.
    

    
           3.3 SARs Not Exercised. If any
      outstanding SAR, or portion thereof, expires, or is terminated, canceled
      or forfeited without being exercised, the number of Shares related to
      such expired, terminated, canceled or forfeited SAR, or portion thereof,
      shall no longer count toward the limit expressed in Section 3.1 and
      shall again be available for the grant of SARs under this Plan.
    

    
           3.4 Dilution and Other Adjustments.
      In the event that the Committee determines that any dividend or other
      distribution (whether in the form of cash, Shares, other securities or
      other property), recapitalization, stock split, reverse stock split,
      reorganization, redesignation, reclassification, merger, consolidation,
      liquidation, split-up, reverse split, spin-off, combination, repurchase
      or exchange of Shares or other securities of the Company, issuance of
      warrants or other rights to purchase Shares or other securities of the
      Company or other similar corporate transaction or event affects the
      Shares such that an adjustment is determined by the Committee to be
      appropriate in order to prevent dilution or enlargement of the benefits
      or potential benefits intended to be made available under this Plan,
      then the Committee may, in such manner as it deems equitable, adjust any
      or all of (i) the number and type of Shares (or other securities or
      other property) which thereafter may be made the subject of SARs,
      (ii) the number and type of Shares (or other securities or other
      property) subject to outstanding SARs, (iii) the limitations set forth
      above and (iv) the purchase or exercise price or any performance
      objective with respect to any SAR; provided, however, that the
      number of Shares or other securities covered by any SAR or to which such
      SAR relates is always a whole number. Notwithstanding the foregoing, the
      foregoing adjustments shall be made in compliance with Code
      Section 409A, to the extent necessary to avoid its application or avoid
      adverse tax consequences thereunder.
    

    
      
        

        

      

      
        
          4
        

        
          

        

      

      
        

        

      

    

    

    

    
      ARTICLE 4
    

    
      Participants
    

    
           4.1 Eligibility. Officers and all
      other key employees of the Company or any of its Affiliates (each an
      “Eligible Employee”) who are selected by the Committee in its sole
      discretion are eligible to participate in this Plan.
    

    
           4.2 Plan Agreements. SARs are
      contingent upon the participant’s execution of a written agreement in a
      form prescribed by the Committee. Execution of a plan agreement shall
      constitute the participant’s irrevocable agreement to, and acceptance
      of, the terms and conditions of the SAR set forth in such agreement and
      of the terms and conditions of the Plan applicable to such SAR. Plan
      agreements may differ from time to time and from participant to
      participant.
    

    

    

    
      ARTICLE 5
    

    
      Grant of Stock Appreciation Rights
    

    
           5.1 SAR Grant and Agreement. Each
      SAR granted under this Plan will be evidenced by minutes of a meeting,
      or by a unanimous written consent without a meeting, of the Committee
      and by a written agreement dated as of the Date of Grant and executed by
      the Company and by the appropriate participant.
    

    
           5.2 Terms and Conditions of SARs.
      Stock Appreciation Rights will be subject to the following terms and
      conditions:
    

    
                (a) Term.
      Any unexercised portion of a Stock Appreciation Right granted hereunder
      shall expire at the end of the stated term of the Stock Appreciation
      Right. The Committee shall determine the term of each Stock Appreciation
      Right at the time of grant, which term shall not exceed ten years from
      the Date of Grant. The Committee may extend the term of a Stock
      Appreciation Right, in its discretion, but not beyond a date later than
      the earlier of (i) the latest date upon which the Stock Appreciation
      Right could have expired by its original terms under any circumstances
      or (ii) the tenth anniversary of the original Date of Grant of the Stock
      Appreciation Right. If a definite term is not specified by the Committee
      at the time of grant, then the term is deemed to be 10 years.
    

    
      
        

        

      

      
        
          5
        

        
          

        

      

      
        

        

      

    

    
                (b) Exercisability.
      A Stock Appreciation Right is exercisable, in whole or in part, at such
      time or times as determined by the Committee at or after the time of
      grant.
    

    
                (c) Exercise
      Price. Subject to Section 3.4, the Exercise Price of a Stock
      Appreciation Right will never be less than 100% of the Fair Market Value
      of the related Shares on the Date of Grant. If a variable Exercise Price
      is specified at the time of grant, the Exercise Price may vary pursuant
      to a formula or other method established by the Committee; provided,
      however, that such formula or method will provide for a minimum
      Exercise Price equal to the Fair Market Value of the Shares on the Date
      of Grant. Except as otherwise provided in Section 3.4, no subsequent
      amendment of an outstanding Stock Appreciation Right may reduce the
      Exercise Price to less than 100% of the Fair Market Value of the Shares
      on the Date of Grant. Nothing in this Section 5.2(c) shall be construed
      as limiting the Committee’s authority to grant premium price Stock
      Appreciation Rights which do not become exercisable until the Fair
      Market Value of the related Shares exceeds a specified percentage (e.g.,
      110%) of the Exercise Price; provided, however, that such
      percentage will never be less than 100%.
    

    
                (d) Method
      of Exercise. A Stock Appreciation Right may be exercised in whole or
      in part during the term by giving written notice of exercise to the
      Company specifying the number of Shares in respect of which the Stock
      Appreciation Right is being exercised. The notice must be given by or on
      behalf of a person entitled to exercise the Stock Appreciation Right.
      Upon the exercise of a Stock Appreciation Right, subject to satisfaction
      of projected tax withholding requirements pursuant to Article 10, the
      holder of the Stock Appreciation Right is entitled to receive payment in
      cash equal in value to the excess of the Fair Market Value of a Share on
      the exercise date over the Exercise Price of the SAR multiplied by the
      number of Stock Appreciation Rights being exercised. At any time the
      Fair Market Value of a Share on a proposed exercise date does not exceed
      the Exercise Price of the SAR, the holder of the Stock Appreciation
      Right shall not be permitted to exercise such right.
    

    
                (e) SAR
      Payable Solely in Cash. All Stock Appreciation Rights granted under
      this Plan shall be settled solely in cash, subject to the withholding
      requirements of this Plan. No Shares shall be issued, paid or delivered
      under this Plan or any SAR, and no Shares shall be reserved by the
      Company for such purpose.
    

    
                (f) Early
      Termination Prior to Expiration. If the employment of an optionee
      with the Company or its Affiliates terminates for any reason, all
      unexercised Stock Appreciation Rights may be exercised only in
      accordance with rules established by the Committee or as specified in
      the relevant agreement evidencing such Stock Appreciation Rights. Such
      rules may provide, as the Committee deems appropriate, for the
      expiration, continuation, or acceleration of the vesting of all or part
      of such Stock Appreciation Rights.
    

    
           5.3 Other Terms and Conditions of SAR
      Grants. Stock Appreciation Rights are subject to such other terms
      and conditions, not inconsistent with the provisions of this Plan, as
      are determined from time to time by the Committee.
    

    
           5.4 Special Limitations. Unless an
      SAR agreement approved by the Committee provides otherwise, Stock
      Appreciation Rights awarded under this Plan are intended to meet the
      requirements for exclusion from coverage under Code Section 409A and all
      Stock Appreciation Right awards shall be construed and administered
      accordingly.
    

    
      
        

        

      

      
        
          6
        

        
          

        

      

      
        

        

      

    

    

    

    
      ARTICLE 6
    

    
      Transfers and Leaves of Absence
    

    
           6.1 Transfer of Participant. For
      purposes of this Plan, the transfer of a participant among the Company
      and its Affiliates is deemed not to be a termination of employment.
    

    
           6.2 Effect of Leaves of Absence.
      For purposes of this Plan, the following leaves of absence are deemed
      not to be a termination of employment:
    

    
                (a) a leave of absence, approved in writing by the Company,
      for military service, sickness or any other purpose approved by the
      Company, if the period of such leave does not exceed 90 days;
    

    
                (b) a leave of absence in excess of 90 days, approved in
      writing by the Company, but only if the employee’s right to reemployment
      is guaranteed either by a statute or by contract, and provided that, in
      the case of any such leave of absence, the employee returns to work
      within 30 days after the end of such leave; and
    

    
                (c) subject to the restrictions of Code Section 409A, any
      other absence determined by the Committee in its discretion not to
      constitute a termination of employment.
    

    

    

    

    

    
      ARTICLE 7
    

    
      Effect of Change in Control
    

    
           7.1 Change in Control Defined.
      “Change in Control” means the occurrence of any of the following:
    

    
                (a) If individuals who, on the effective date of this Plan,
      constitute the Board of Directors (the “Incumbent Directors”) cease for
      any reason to constitute at least a majority of the Board of Directors;
      provided, however, that:
    

    
    	
           
        	
          (i)
        	
          any person becoming a director subsequent to the effective date of
          this Plan, whose election or nomination for election was approved by
          a vote of at least two-thirds (2/3) of the Incumbent Directors then
          on the Board of Directors (either by a specific vote or by approval
          of the proxy statement of the Company in which such person is named
          as a nominee for director, without written objection by such
          Incumbent Directors to such nomination), shall be deemed to be an
          Incumbent Director, and
        
	

        	

        	
           
        
	

        	
          (ii)
        	
          no individual elected or nominated as a director of the Company
          initially as a result of an actual or threatened election contest
          with respect to directors or any other actual or threatened
          solicitation of proxies by or on behalf of any person other than the
          Board of Directors shall be deemed to be an Incumbent Director;
        

    

    
      
        

        

      

      
        
          7
        

        
          

        

      

      
        

        

      

    

    
                (b) If any “person” (as such term is defined in
      Section 3(a)(9) of the Exchange Act, and as used in Sections 13(d)(3)
      and 14(d)(2) of the Exchange Act) is or becomes a “beneficial owner” (as
      defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
      of securities of the Company representing twenty percent (20%) or more
      of the combined voting power of the Company’s then-outstanding
      securities eligible to vote for the election of the Board of Directors
      (the “Company Voting Securities”); provided, however, that the events
      described in this paragraph (b) shall not be deemed to be a Change in
      Control by virtue of any of the following acquisitions of Company Voting
      Securities:
    

    
    	
           
        	
          (i)
        	
          by the Company or any Subsidiary,
        
	

        	

        	
           
        
	

        	
          (ii)
        	
          by any employee benefit plan sponsored or maintained by the Company
          or any Subsidiary or by any employee stock benefit trust created by
          the Company or any Subsidiary,
        
	

        	

        	
           
        
	

        	
          (iii)
        	
          by any underwriter temporarily holding securities pursuant to an
          offering of such securities,
        
	

        	

        	
           
        
	

        	
          (iv)
        	
          pursuant to a Non-Qualifying Transaction (as defined in paragraph
          (c), below), or
        
	

        	

        	
           
        
	

        	
          (v)
        	
          a transaction (other than one described in paragraph (c), below) in
          which Company Voting Securities are acquired from the Company, if a
          majority of the Incumbent Directors approves a resolution providing
          expressly that the acquisition pursuant to this subparagraph (v)
          does not constitute a Change in Control under this paragraph (b);
        

    

    
                (c) The consummation of a merger, consolidation, share
      exchange or similar form of corporate transaction involving the Company
      or any of its Subsidiaries that requires the approval of the Company’s
      shareholders, whether for such transaction or the issuance of securities
      in the transaction (a “Business Combination”), unless immediately
      following such Business Combination:
    

    
    	
           
        	
          (i)
        	
          more than fifty percent (50%) of the total voting power of either
          (x) the corporation resulting from the consummation of such Business
          Combination (the “Surviving Corporation”) or, if applicable, (y) the
          ultimate parent corporation that directly or indirectly has
          beneficial ownership of one hundred percent (100%) of the voting
          securities eligible to elect directors of the Surviving Corporation
          (the “Parent Corporation”) is represented by Company Voting
          Securities that were outstanding immediately prior to such
        
	

        	

        	
           
        
	

        	

        	
          Business Combination (or, if applicable, represented by shares into
          which such Company Voting Securities were converted pursuant to such
          Business Combination), and such voting power among the holders
          thereof is in substantially the same proportion as the voting power
          of such Company Voting Securities among the holders thereof
          immediately prior to the Business Combination,
        

    

    
      
        

        

      

      
        
          8
        

        
          

        

      

      
        

        

      

    

    
    	
           
        	
          
            (ii)
          

        	
          no person (other than any employee benefit plan sponsored or
          maintained by the Surviving Corporation or the Parent Corporation or
          any employee stock benefit trust created by the Surviving
          Corporation or the Parent Corporation) is or becomes the beneficial
          owner, directly or indirectly, of twenty percent (20%) or more of
          the total voting power of the outstanding voting securities eligible
          to elect directors of the Parent Corporation (or, if there is no
          Parent Corporation, the Surviving Corporation), and
        
	

        	

        	
           
        
	

        	
          (iii)
        	
          at least a majority of the members of the board of directors of the
          Parent Corporation (or, if there is no Parent Corporation, the
          Surviving Corporation) were Incumbent Directors at the time of the
          Board of Director’s approval of the execution of the initial
          agreement providing for such Business Combination (any Business
          Combination which satisfies all of the criteria specified in (i),
          (ii) and (iii) of this Section 9.1(c) shall be deemed to be a
          “Non-Qualifying Transaction”); or
        

    

    
                (d) If the shareholders of the Company approve a plan of
      complete liquidation or dissolution of the Company or a sale of all or
      substantially all of the Company’s assets but only if, pursuant to such
      liquidation or sale, the assets of the Company are transferred to an
      entity not owned (directly or indirectly) by the Company’s shareholders.
    

    
      Notwithstanding the foregoing, a Change in Control shall not be deemed
      to occur solely because any person acquires beneficial ownership of more
      than twenty percent (20%) of Company Voting Securities as a result of
      the acquisition of Company Voting Securities by the Company which
      reduces the number of Company Voting Securities outstanding; provided,
      however, that if (after such acquisition by the Company) such person
      becomes the beneficial owner of additional Company Voting Securities
      that increases the percentage of outstanding Company Voting Securities
      beneficially owned by such person, a Change in Control shall then occur.
    

    
           7.2 Effect of Change in Control. In
      the event of a Change in Control of the Company, the Committee shall
      have the right, in its sole discretion, to:
    

    
                (a) accelerate the exercisability of any or all SARs,
      notwithstanding any limitations set forth in the Plan or SAR agreement;
    

    
                (b) to the extent it would not trigger adverse taxation under
      Code Section 409A, cancel any or all outstanding SARs in exchange for
      fair value, which, in the case of SARs, shall equal the excess, if any,
      of the value of the consideration to be paid in the Change in Control
      transaction to holders of the same number of Shares subject to such SARs
      (or, if no consideration is paid in any such transaction, the Fair
      Market Value of the Shares subject to such SARs as of the date of the
      Change in Control) over the aggregate Exercise Price of such SARs;
    

    
                (c) to the extent it would not trigger adverse taxation under
      Code Section 409A, provide for the issuance of substitute SARs that will
      substantially preserve the otherwise applicable terms and value of any
      affected Awards previously granted hereunder as determined by the
      Committee; or
    

    
                (d) take such other action as it deems appropriate to preserve
      the value of the SAR to the Participant.
    

    
      
        

        

      

      
        
          9
        

        
          

        

      

      
        

        

      

    

    
      The Committee may provide for any of the foregoing in an SAR agreement
      in advance, may provide for any of the forgoing in connection with a
      Change in Control, or do both. Alternatively, the Committee shall also
      have the right to require any purchaser of the Company’s assets or
      stock, as the case may be, to take any of the actions set forth in the
      preceding sentence as such purchaser may determine to be appropriate or
      desirable.
    

    
                The manner of application and interpretation of the foregoing
      provisions of this Section 7.2 shall be determined by the Committee in
      its sole and absolute discretion.
    

    

    

    
      ARTICLE 8
    

    
      Transferability of SARs
    

    
           8.1 SARs Are Non-Transferable.
      Except as provided in Section 8.2, SARs are non-transferable and any
      attempts to assign, pledge, hypothecate or otherwise alienate or
      encumber (whether by operation of law or otherwise) any SAR shall be
      null and void.
    

    
           8.2 Inter-Vivos Exercise of SARs;
      Limited Transferability of Certain SARs. During a participant’s
      lifetime, SARs are exercisable only by the participant or, as permitted
      by applicable law and notwithstanding Section 8.1 to the contrary, the
      participant’s guardian or other legal representative. Notwithstanding
      Section 8.1 to the contrary, SARs may be transferred by will and by the
      laws of descent and distribution and to the extent required by a court
      order.
    

    

    

    
      ARTICLE 9
    

    
      Amendment and Discontinuation
    

    
           9.1 Amendment or Discontinuation of
      this Plan. The Board of Directors may amend, alter, or discontinue
      this Plan at any time, provided that no amendment, alteration, or
      discontinuance may be made:
    

    
                (a) which would materially and adversely affect the rights of
      a participant under any SAR granted prior to the date such action is
      adopted by the Board of Directors without the participant’s written
      consent thereto; and
    

    
                (b) without shareholder approval, if shareholder approval is
      required under applicable laws, regulations or exchange requirements.
    

    
      Notwithstanding the foregoing, this Plan may be amended without
      affecting participants’ consent to: (i) comply with any law;
      (ii) preserve any intended favorable tax effects for the Company, the
      Plan or participants; or (iii) avoid any unintended unfavorable tax
      effects for the Company, the Plan or participants.
    

    
           9.2 Amendment of Grants. The
      Committee may amend, prospectively or retroactively, the terms of any
      outstanding SAR, provided that no such amendment may be inconsistent
      with the terms of this Plan (specifically including the prohibition on
      granting SARs with an Exercise Price less than 100% of the Fair Market
      Value of the related Common Shares on the Date of Grant) or would
      materially and adversely affect the rights of any holder without his or
      her written consent.
    

    
      
        

        

      

      
        
          10
        

        
          

        

      

      
        

        

      

    

    

    

    
      ARTICLE 10
    

    
      Satisfaction of Projected Tax Liabilities
    

    
           10.1 In General. The Committee
      shall cause the Company to withhold any taxes which it determines it is
      required by law or required by the terms of this Plan to withhold in
      connection with any payments incident to this Plan. The participant or
      other recipient shall provide the Committee with such additional
      information or documentation as may be necessary for the Committee to
      discharge its obligations under this Section. The Company may withhold
      cash in an amount equal to the amount which the Committee determines is
      necessary to satisfy the obligation of the Company to withhold federal,
      state and local income taxes or other amounts incurred by reason of the
      grant or exercise of an SAR or its disposition. Alternatively, the
      Company may require the holder to pay to the Company such amounts, in
      cash, promptly upon demand.
    

    

    

    
      ARTICLE 11
    

    
      General Provisions
    

    
           11.1 No Implied Rights to SARs or
      Employment. No potential participant has any claim or right to be
      granted an SAR under this Plan, and there is no obligation of uniformity
      of treatment of participants under this Plan. Neither this Plan nor any
      SAR thereunder shall be construed as giving any individual any right to
      continued employment with the Company or any Affiliate. The Plan does
      not constitute a contract of employment, and the Company and each
      Affiliate expressly reserve the right at any time to terminate employees
      free from liability, or any claim, under this Plan, except as may be
      specifically provided in this Plan or in an SAR agreement.
    

    
           11.2 Other Compensation Plans.
      Nothing contained in this Plan prevents the Board of Directors from
      adopting other or additional compensation arrangements, subject to
      shareholder approval if such approval is required, and such arrangements
      may be either generally applicable or applicable only in specific cases.
    

    
           11.3 Rule 16b-3 Compliance.
      The Plan is intended to comply with all applicable conditions of
      Rule 16b-3 of the Exchange Act, as such rule may be amended from time to
      time (“Rule 16b-3”). All transactions involving any participant subject
      to Section 16(a) of the Exchange Act shall be subject to the conditions
      set forth in Rule 16b-3, regardless of whether such conditions are
      expressly set forth in this Plan. Any provision of this Plan that is
      contrary to Rule 16b-3 does not apply to such participants.
    

    
           11.4 Successors. All obligations of
      the Company with respect to SARs granted under this Plan are binding on
      any successor to the Company, whether as a result of a direct or
      indirect purchase, merger, consolidation or otherwise of all or
      substantially all of the business and/or assets of the Company.
    

    
      
        

        

      

      
        
          11
        

        
          

        

      

      
        

        

      

    

    
           11.5 Severability. In the event any
      provision of this Plan, or the application thereof to any person or
      circumstances, is held illegal or invalid for any reason, the illegality
      or invalidity shall not affect the remaining parts of this Plan, or
      other applications, and this Plan is to be construed and enforced as if
      the illegal or invalid provision had not been included.
    

    
           11.6 Governing Law. To the extent
      not preempted by Federal law, this Plan and all SAR agreements pursuant
      thereto are construed in accordance with and governed by the laws of the
      State of Ohio. This Plan is not intended to be governed by the Employee
      Retirement Income Security Act and shall be so construed and
      administered.
    

    

    

    
      ARTICLE 12
    

    
      Effective Date
    

    
           12.1 Effective Date. The effective
      date of this LNB Bancorp, Inc. Stock Appreciation Rights Plan is the
      date on which the Board of Directors approves it.
    

    

    

    
      ARTICLE 13
    

    
      Compliance with Laws
    

    
           13.1  EESA.  To the
      extent that an Eligible Employee and Stock Appreciation Rights are
      subject to Section 111 of the Emergency Economic Stabilization Act of
      2008 and any regulations, guidance or interpretations that may from time
      to time be promulgated thereunder or any other applicable statute or
      regulation affecting an Eligible Employee’s compensation (“EESA or Other
      Applicable Law”), then any payment of any kind provided for by, or
      accrued with respect to, the Stock Appreciation Rights must comply with
      EESA or Other Applicable Law, and the Stock Appreciation Rights
      agreement and this Plan shall be interpreted or reformed to so comply.
      If applicable, Stock Appreciation Rights will be subject to forfeiture
      or repayment, and subject to recovery by the Company, if the Stock
      Appreciation Rights are based on financial statements or other
      performance metrics that are later determined to be materially
      inaccurate.
    

    
           13.2  Code Section 409A.  In
      addition to the general amendment rights of the Company with respect to
      the Plan, the Company specifically retains the unilateral right (but not
      the obligation) to make, prospectively or retroactively, any amendment
      to this Plan or any related document as it deems necessary or desirable
      to more fully address issues in connection with exemption from (or
      compliance with)  Code Section 409A and other laws.  In no event,
      however, shall this section or any other provisions of this Plan be
      construed to require the Company to provide any gross-up for the tax
      consequences of any provisions of, or payments under, this Plan and the
      Company and its Affiliates shall have no responsibility for tax or legal
      consequences to any participant (or beneficiary) resulting from the
      terms or operation of this Plan.
    

    

    

    
      12

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