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United States SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
 for the fiscal year ended: December 31, 2005
 Commission File Number 0-14773
 National Bancshares Corporation
 (Exact name of registrant as specified in its charter)
 Ohio
    
    34-1518564(State or other jurisdiction
of incorporation or organization)
    
    (IRS Employer
Identification No.)
 (330) 682-1010  Address, including zip code, and telephone number,
including area code, of registrants principal executive offices
 Securities registered pursuant to section 12(b) of the Act none
 Securities registered pursuant to section 12(g) of the Act common stock,
without par value
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   Documents Incorporated by Reference




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Table of Contents
 PagePart IItem 1
    
    Business
    
    1Item 1A
    
    Risk Factors
    
    12Item 1B
    
    Unresolved Staff Comments
    
    N/AItem 2
    
    Properties
    
    15Item 3
    
    Legal Proceedings
    
    16Item 4
    
    Submission of Matters to a Vote of Security Holders
    
    16Part IIItem 5
    
    Market for Registrants Common Equity and Related Stockholder Matters
    
    17Item 6
    
    Selected Financial Data
    
    17Item 7
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    17Item 7A
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    17Item 8
    
    Financial Statements and Supplementary Data
    
    17Item 9
    
    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    17Item 9A
    
    Controls and Procedures
    
    17Item 9B
    
    Other Information
    
    18Part IIIItem 10
    
    Directors and Executive Officers of the Registrant
    
    19Item 11
    
    Executive Compensation
    
    20Item 12
    
    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    
    20Item 13
    
    Certain Relationships and Related Transactions
    
    20Item 14
    
    Principal Accounting Fees and Services
    
    20Part IVItem 15
    
    Exhibits and Financial Statement Schedules
    
    21Signatures
    
    
    
    23EX-13 Annual ReportEX-14 Code of Business Conduct and EthicsEX-21 SubsidiariesEX-23 Consent of Crowe Chizek and Company LLCEX-31.1 302 Certification for CEOEX-31.2 302 Certification for CFOEX-32 906 Certification for CEO and CFO
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Item 1  Business
 Forward-looking Statements
  
    
    the strength of the United States economy in general and the
strength of the local economies in which we conduct our operations;
general economic conditions, either nationally or regionally, may
be less favorable than we expect, resulting in a deterioration in
the credit quality of our loan assets, among other things
    
    the effects of, and changes in, trade, monetary and fiscal
policies and laws, including interest-rate policies of the Federal
Reserve Board
    
    inflation, interest rate, market, and monetary fluctuations
    
    the development and acceptance of new products and services of
National Bancshares and its subsidiary and the perceived overall
value of these products and services by users, including the
features, pricing, and quality compared to competitors products
and services
    
    the willingness of users to substitute our products and services
for those of competitors
    
    the impact of changes in financial services laws and regulations
(including laws concerning taxes, banking, securities, and
insurance)
    
    changes in consumer spending and saving habits
  Company Milestones
 1881
    
    First National Bank is chartered under the name Orrville Banking Company
 1902
    
    the Banks name is changed to Orrville National Bank
 1933
    
    the Bank is reorganized and renamed once again, the National Bank of Orrville
 1965
    
    on May 12 the Bank opens its first branch, on West High Street
 1968
    
    on February 1 the Bank merges with the First National Bank of Dalton, becoming the First
National Bank Orrville-Dalton
 1969
    
    on November 1 the Bank merges with the Bank of Mt. Eaton Company
 1972
    
    on January 1 the Farmers and Merchants Bank Company of Smithville merges with the Bank, and
changes its name to First National Bank
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1975
    
    on July 5 the Bank opens its Midway office in Apple Creek
 1978
    
    the Bank opens a drive-through only office (Northside) in Orrville on September 18
 1986
    
    National Bancshares Corporation becomes the holding company for First National Bank on June 2
 1989
    
    the Bank enters Medina County with the purchase of its Lodi office on April 14
 1994
    
    on December 16 the Bank establishes its second Medina County office with the purchase of the
Seville branch
 1999
    
    the Bank opens its Cleveland Road office in the city of Wooster on April 19
 2002
    
    the acquisition of Peoples Financial Corporation and its subsidiary, Peoples Federal Savings
and Loan Association of Massillon, is completed on April 3, adding three more banking offices,
our first offices in Stark County
 2005
    
    the Bank closes its MarketPlace office in the city of Massillon on May 31 and opens its
Burbank Road office in the city of Wooster on June 30
 Market Area
 www.odod.state.oh.us/research) lmi.state.oh.us Ohio County Profiles www.odod.state.oh.us/research
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Competition
  www.fdic.gov th th th th
  3




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Lending
     
    
    accounts receivable, inventory and working capital
loans
    
    renewable operating lines of credit
    
    loans to finance capital equipment
    
    term business loans
    
    short-term notes
    
    selected guaranteed or subsidized loan
programs for small businesses
    
    loans to professionals
    
    commercial real estate loans, including agricultural
loans secured by farmland
    
    loans for agricultural production and other loans to
farmers
  4




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
    
    residential construction loans to borrowers who will occupy the premises upon completion
of construction,
    
    residential construction loans to builders,
    
    commercial construction loans, and
    
    real estate acquisition and development loans.
    Loan Solicitation and Processing
  5




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Income from Lending Activities
 Delinquent Loans
  Investments
 Sources of Funds Deposit Accounts
 Borrowings
 Personnel
 Minority Ownership of a Title Insurance Agency
 6




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Available Information http://www.sec.gov www.fnborrville.com
 Supervision and Regulation
     Regulation of Bank Holding Companies Bank and Bank Holding Company Acquisitions
 
    
    directly or indirectly acquiring ownership or control of any voting shares of another
bank or bank holding company, if after the acquisition the acquiring company would own or
control more than 5% of the shares of the other bank or bank holding company (unless the
acquiring company already owns or controls a majority of the shares),
    
    acquiring all or substantially all of the assets of another bank, or
    
    merging or consolidating with another bank holding company.
  7




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Nonbanking Activities
 Financial Holding Companies
 
    
    financial in nature or incidental to that financial activity, or
    
    complementary to a financial activity and that does not pose a substantial risk to the
safety and soundness of depository institutions or the financial system generally.
  
    
    acting as principal, agent, or broker for insurance,
    
    underwriting, dealing in, or making a market in securities, and
    
    providing financial and investment advice.
  8




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Holding Company Capital and Source of Strength
  Federal Deposit Insurance
   Interstate Banking and Branching
 9




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de novo de novo de novo
 Capital Risk-Based Capital Requirements
     Prompt Corrective Action
 10




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Limits on Bank Dividends to the Holding Company
  Transactions with Affiliates
 
    
    limit the extent to which a bank or its subsidiaries may lend to or engage in various
other kinds of transactions with any one affiliate to an amount equal to 10% of the banks
capital and surplus, limiting the aggregate of covered transactions with all affiliates to
20% of capital and surplus,
    
    impose restrictions on investments by a subsidiary bank in the stock or securities of
its holding company,
    
    impose restrictions on the use of a holding companys stock as collateral for loans by
the subsidiary bank, and
    
    require that affiliate transactions be on terms substantially the same or at least as
favorable to the institution or subsidiary as those provided to a non-affiliate.
  11




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Community Reinvestment Act
  Monetary Policy
 
 ITEM 1A  RISKS FACTORS
 Success in the banking industry requires disciplined management of lending risks
 Concentration of service area could negatively affect financial performance.
 Changing interest rates have a direct and immediate impact on financial institutions
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First National Bank has significant competition in both attracting and retaining deposits and
in originating loans.
 The banking industry is heavily regulated; the compliance burden to the industry is
considerable; the principal beneficiary of federal and state regulation is the public at large and
depositors, not shareholders
  National Bancshares Corporation common stock is thinly traded. It is therefore susceptible to
wide price swings ®
  
    
    a company must have an audit committee consisting of independent directors,
    
    the audit committee must be responsible for the appointment, compensation,
retention, and oversight of the independent auditor,
    
    the audit committee must establish procedures for the submission of complaints
about accounting, auditing, and internal control issues and for the anonymous
submission of accounting and auditing concerns by employees,
    
    the audit committee must have authority to engage its own advisors, and
    
    the company must ensure that the audit committee has ample funding for payment
of independent auditor compensation, for compensation of advisors, and for other
administrative expenses.
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Government regulation could restrict our ability to pay cash dividends
 We could incur liabilities under federal and state environmental laws if we foreclose on
commercial properties
 Growth through acquisition involves special risks
  Accounting for probable loan losses is a critical accounting policy
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Item 2  Properties
  Net Book ValueLocation
    
    County
    
    (Dollars in Thousands)Main Office:
112 West Market Street
Orrville, Ohio 44667
    
    Wayne
    
    $
    422Branches:
12 West Main Street
Dalton, Ohio 44618
    
    Wayne
    
    $
    1411320 West High Street
Orrville, Ohio 44667
    
    Wayne
    
    $
    954934 Kidron Road
Kidron, Ohio 44636
    
    Wayne
    
    $
    267153 East Main Street 
Smithville, Ohio 44677
    
    Wayne
    
    $
    7115974 East Main Street 
Mt. Eaton, Ohio 44659
    
    Wayne
    
    $
    30U.S. Route 30 at County Road 44
7227 Lincoln Way East
Apple Creek, Ohio 44606
    
    Wayne
    
    $
    1051720 North Main Street
Orrville, Ohio 44667
    
    Wayne
    
    $
    801725 Cleveland Road
Wooster, Ohio 44691
    
    Wayne
    
    $
    5624192 Burbank Road 
Wooster, Ohio 44691
    
    Wayne
    
    $
    928211 Lincoln Way East 
Massillon, Ohio 44646
    
    Stark
    
    $
    7072312 Lincoln Way N.W.
Massillon, Ohio 44647
    
    Stark
    
    $
    40951 Massillon Marketplace Drive S.W.
Massillon, Ohio 44646
(cash ATM only)
(leased location)
    
    Stark
    
    $
    19106 Ainsworth Street 
Lodi, Ohio 44254
    
    Medina
    
    $
    339121 Greenwich Road 
Seville, Ohio 44667
(leased facility)
    
    Medina
    
    $
    38
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Item 3  Legal Proceedings
  
 Item 4  Submission of Matters to a Vote of Security Holders
  16




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Part II
 
 Item 5  Market for Registrants Common Equity and Related Stockholder
Matters
 See
  
 Item 6  Selected Financial Data
  
 Item 7  Managements Discussion and Analysis of Financial Condition and Results of
Operations
  
 Item 7A  Quantitative and Qualitative Disclosures About Market Risk
  
 Item 8  Financial Statements and Supplementary Data
  
 Item 9  Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure
  
 Item 9A  Controls and Procedures
  17




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Item 9B  OTHER INFORMATION
  18




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Part III
 
 Item 10  Directors and Executive Officers of the Registrant
   Name
    
    Age
    
    PositionCharles J. Dolezal
    
    
    52
    
    
    Chairman of the Board, President and Chief Executive Officer of
National Bancshares Corporation and First National Bank. Mr. Dolezal
has been an executive officer of National Bancshares Corporation since it was
formed in 1986, and President of First National Bank since 1982Kenneth R. VanSickle
    
    
    58
    
    
    Mr. VanSickle has served as Senior Vice President and Secretary of
National Bancshares Corporation since April 1997. He has been a
senior loan officer of First National Bank since 1986, currently serving
as Senior Vice President and Chief Loan OfficerMarc Valentin
    
    
    38
    
    
    Mr. Valentin has served as Vice President and Treasurer of National
Bancshares Corporation and Vice President and Controller of the Bank
since September 2005. He has served as Vice President of Human
Resources since September 2004. Mr. Valentin is the principal
financial and accounting officer. Prior to joining First National, Mr. Valentin
was a business unit controller for Bekaert Contours for one year, a
manufacturing firm in Orrville, Ohio. Prior to that position, he was
the controller for Contours, Ltd., a member of the Bekaert Group for
five years.James A. Huntsberger
    
    
    44
    
    
    Mr. Huntsberger has served as Vice President of Operations, A/L Management
and Cashier of First National Bank since August 2005. Previously he
served as asset and liability manager, internal auditor and credit
analyst of First National Bank.Tammy Starkey
    
    
    41
    
    
    Ms. Starkey has served as Vice President of Risk Management since August 2005.
She served as internal auditor for First National Bank since 2003. Prior
to joining First National Bank, Ms. Starkey was employed by Dollar
Bank and National City Bank in various internal audit and branch
management capacities.Paul G. Kubiak
    
    
    45
    
    
    Mr. Kubiak has served as Vice President of Sales and Marketing for First National
Bank since August 2005. Prior to this, he was a business development
officer for the Bank since March 2004. Prior to joining the Bank,
Mr. Kubiak served as Manager of Customer Service for Bekaert Contours
and Contours, Ltd., a manufacturing firm in Orrville, Ohio.
    19




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Item 11  Executive Compensation
  
 Item 12  Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
  
 Item 13  Certain Relationships and Related Transactions
  
 Item 14  Principal Accounting Fees and Services
  20




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Part IV
 
 Item 15  Exhibits AND Financial Statement Schedules
 (a)(1)
    
    Financial Statements
  
    
    Report of Independent Registered Public Accounting Firm
    
    Consolidated Balance Sheets at December 31, 2005 and 2004
    
    Consolidated Statements of Income for the Years Ended December 31, 2005, 2004, and 2003
    
    Consolidated Statements of Changes in Shareholders Equity for the Years Ended December 31, 2005, 2004, and 2003
    
    Consolidated Statements of Cash Flows for the Years Ended December 31, 2005, 2004, and 2003
    
    Notes to Consolidated Financial Statements
 (a)(2)
    
    Financial Statement Schedules
  (a)(3)
    
    Exhibits
  Exhibits Required by Item 601 of Regulation S-K
 ExhibitNumber
    
    Description
    
    Location3.1
    
    Amended Articles of Incorporation
    
    Incorporated by reference to the identically numbered
exhibit to the Annual Report on Form 10-K for the fiscal
year ended December 31, 2003, filed on March 26, 20043.2
    
    Code of Regulations
    
    Incorporated by reference to the identically numbered
exhibit to the Annual Report on Form 10-K for the fiscal
year ended December 31, 2003, filed on March 26, 200410.1*
    
    Directors Defined Benefit Plan Agreement
    
    Incorporated by reference to the identically numbered
exhibit to the Annual Report on Form 10-K for the fiscal
year ended December 31, 2000, filed on March 29, 200110.2*
    
    Special Separation Agreement of Charles J.
Dolezal, President and Chief Executive Officer
    
    Incorporated by reference to the identically numbered exhibit
to the Annual Report on Form 10-K for the fiscal year ended
December 31, 2000, filed on March 29, 2001. One
executive officer of the Company, Kenneth R. VanSickle,
entered into this agreement in June 2000. Mr.
Dolezals and Mr. Van Sickles agreements have
a three-year term and provide for benefits
equal to three-years pay.10.3*
    
    Special Separation Agreement of Marc
Valentin
    
    Incorporated by reference to the identically numbered exhibit
on Form 10-Q for the quarter ended September 30, 2004,
filed on November 15, 2004.13
    
    2005 Annual Report to Security Holders
    
    Filed herewith14
    
    Code of Business Conduct and Ethics
    
    Filed herewith21
    
    Subsidiaries
    
    Filed herewith23
    
    Consent of Crowe Chizek and Company LLC
    
    Filed herewith31.1
    
    Certification of Chief Executive Officer under
Sarbanes-Oxley Act section 302
    
    Filed herewith
 21




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Exhibits Required by Item 601 of Regulation S-K (continued)
 ExhibitNumber
    
    Description
    
    Location31.2
    
    Certification of Chief Financial Officer under
Sarbanes-Oxley Act section 302
    
    Filed herewith32
    
    Certification under Sarbanes-Oxley Act section
906
    
    Filed herewith
 
 *
    
    Management contract or compensatory plan or arrangement 22




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Signatures
  National Bancshares CorporationBy:
    
    /s/ Charles J. DolezalCharles J. DolezalPresident and Chief Executive OfficerDate: March 24, 2006
  /s/ Charles J. Dolezal

Charles J. Dolezal
President, Chief Executive Officer, and Director
    
    
    
    March 21, 2006/s/ Marc Valentin

Marc Valentin, Vice President and Treasurer
(Principal Accounting and Financial Officer)
    
    
    
    March 21, 2006/s/ Sara Steinbrenner Balzarini

Sara Steinbrenner Balzarini, Director
    
    
    
    March 21, 2006/s/ John Cook, CPA, Ph. D.

John Cook, CPA, Ph. D., Director
    
    
    
    March 21, 2006/s/ Bobbi Douglas

Bobbi Douglas, Director
    
    
    
    March 21, 2006/s/ John W. Kropf

John W. Kropf, Director
    
    
    
    March 21, 2006/s/ Steven Schmid

Steven Schmid, Director
    
    
    
    March 21, 2006/s/ John E. Sprunger

John E. Sprunger, Director
    
    
    
    March 21, 2006/s/ Howard J. Wenger

Howard J. Wenger, Director
    
    
    
    March 21, 2006/s/ James F. Woolley

James F. Woolley, Director
    
    
    
    March 21, 2006/s/ Albert Yeagly

Albert Yeagley, Director
    
    
    
    March 21, 2006
 23