<PAGE>1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10K/A
Annual Report Pursuant to Section 13 OR 15(d) of
the Securities Exchange Act of 1934
For the fiscal year ended Commission file
December 31, 1994 number 0-13203
Amendment Number 2
LNB Bancorp, Inc.
(Exact name of the registrant as specified in its Charter)
Ohio 34-1406303
(State of incorporation) (I.R.S. Employer Identification No.)
457 Broadway, Lorain, Ohio 44052-1769
(Address of principal executive offices) (Zip Code)
(216) 244 - 6000
(Registrant's telephone number, including area code)
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934:
Title of Each Class Name of Each Exchange on Which Registered
Common Stock, Par Value $1.00 NASDAQ - OTC
Per Share
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that
the Registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. YES [X] NO [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form 10-K. [ ]
The aggregate market value of the voting stock held by non-affiliates
of the Registrant at May 31, 1995 was approximately $71,416,000.
The number of shares of Registrant's Common Stock outstanding on
May 31, 1995 was 4,014,393.
1
<PAGE>2
The undersigned registrant hereby amends the following items of its
Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 on Form 10-K for the fiscal year ended December 31, 1994 for
the purpose of furnishing financial statements for the Lorain National Bank
Employee Stock Ownership Plan and the Lorain National Bank Stock Purchase
Plan:
PART II
ITEM 14 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(3) Exhibits:
(99.1) Annual report on Form 11-K of The Lorain National Bank
Employee Stock Ownership Plan (registration number 33-65036)
for the plan year ended December 31, 1994.
(99.2) Annual report on Form 11-K of The Lorain National Bank
Stock Purchase Plan (registration number 33-65036)
for the plan year ended December 31, 1994.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
LNB Bancorp, Inc.
(Registrant)
Date: June 15, 1995 By: /s/ Gregory D. Friedman
------------- -----------------------
Senior Vice President and
Chief Financial Officer
(Acting Chief Accounting Officer)
2
<PAGE>3
LNB Bancorp, Inc.
Form 10K/A
Exhibit Index
Pursuant to Item 601 (a) of Regulation S-K
S-K Reference Exhibit
Number
(99.1) Annual report on Form 11-K of The Lorain National Bank
Employee Stock Ownership Plan (registration number 33-65036)
for the plan year ended December 31, 1994.
(99.2) Annual report on Form 11-K of The Lorain National Bank
Stock Purchase Plan (registration number 33-65036)
for the plan year ended December 31, 1994.
3
<PAGE>4
LNB Bancorp, Inc.
Exhibit to Form 10 - K/A
(for the fiscal year ended December 31, 1994)
S - K Reference Number (99.1)
Annual report on Form 11-K of The Lorain National Bank
Employee Stock Ownership Plan (registration number 33-65036)
for the plan year ended December 31, 1994 filed as an
amendment to the annual report on Form 10-K.
4
<PAGE>5
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS
AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1994
Note: This Form 11-K is being filed as an amending exhibit to the
Form 10-K of LNB Bancorp, Inc. for the fiscal year ended December
31, 1994 pursuant to Rule 15d-21, therefore no fee is required.
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________________ to ___________
Commission file number 0-13203
THE LORAIN NATIONAL BANK EMPLOYEE STOCK OWNERSHIP PLAN
______________________________________________________
(Full title of the plan)
Lorain National Bank 457 Broadway Lorain, Ohio 44052-1769
_____________________________________________________________
(Name of issuer of the securities held pursuant to the plan and
the address of its principal executive office)
5
<PAGE>6
REQUIRED INFORMATION
Audited plan financial statements and schedules prepared in accordance
with the financial reporting requirements of the Employee Retirement
Income Securities Act of 1974, as amended, are filed herewith in lieu of
the requirements of an audited statement of financial condition and
statement of income and changes in plan equity.
Financial Statements and Exhibits
A) The following financial statements and schedules are filed as part of
this annual report.
1) Statements of Assets Available for Distribution to Participants -
December 31, 1994 and 1993
2) Statements of Changes in Assets Available for Distribution to
Participants - Years ended December 31, 1994 and 1993.
3) Notes to Financial Statements - December 31, 1994 and 1993
4) Schedule 1 - Item 27a - Schedule of Assets Held for Investment -
December 31, 1994
5) Schedule 2 - Item 27e - Schedule of Party-In-Interest Transactions -
Year ended December 31, 1994
6) Schedule 3 - Item 27d - Schedule of Reportable Transactions -
Year ended December 31, 1994
B) The following exhibit is filed as part of this annual report:
24. Consent of Independent Accountants
6
<PAGE>7
(COVER EMBOSSED WITH LOGO)
KPMG Peat Marwick LLP
The Lorain National Bank
Employee Stock Ownership Plan
Financial Statements and Schedules
December 31, 1994 and 1993
(With Independent Auditors' Report Thereon)
7
<PAGE>8
(LETTERHEAD)
(LOGO)
KPMG Peat Marwick LLP
1500 National City Center
1900 East Ninth Street
Cleveland, OH 4414-3495
Independent Auditors' Report
----------------------------
The Board of Directors
The Lorain National Bank
Sponsor of The Lorain National Bank
Employee Stock Ownership Plan:
We have audited the accompanying statements of assets available for
distribution to participants of The Lorain National Bank Employee Stock
Ownership Plan (Plan) as of December 31, 1994 and 1993, and the related
statements of changes in assets available for distribution to
participants for the years then ended. These financial statements are
the responsibility of the Plan's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the assets available for distribution to participants
of the Plan as of December 31, 1994 and 1993, and the changes in those assets
for the years then ended in conformity with generally accepted accounting
principles.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of
assets held for investment at December 31, 1994 and party-in-interest
and reportable transactions for the year ended December 31, 1994, are
presented for purposes of additional analysis and are not a required part
of the basic financial statements, but are supplementary information required
by the Department of Labor's Rules and Regulations for Reporting and Disclosure
under the Employee Retirement Income Security Act of 1974. The supplemental
schedules have been subjected to the auditing procedures applied in the audit of
the basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
/s/ KPMG Peat Marwick LLP
Cleveland, Ohio
April 7, 1995
(LOGO)
Member Firm of
Klynveld Peat Marwick Goerdeler
8
<PAGE>9
THE LORAIN NATIONAL BANK
EMPLOYEE STOCK OWNERSHIP PLAN
Statements of Assets Available for Distribution to Participants
December 31, 1994 and 1993
1994 1993
---- ----
Assets available for distribution
to participants
Short-term cash investments $ 204,546 200,349
Investments, at fair value (note 3)
Common stock - LNB Bancorp, Inc. 1,731,163 1,155,026
Mutual funds 96,275 91,465
United States government securities 972,873 893,694
----------- ----------
Total investments 2,800,311 2,140,185
Employer contribution receivable - 52,000
Dividends and interest receivable 16,203 13,381
----------- ----------
Assets available for
distribution to participants $ 3,021,060 2,405,915
=========== ==========
Assets available for distribution to
participants
Assets payable to terminating participants $ 204,517 67,224
Assets available for continuing participants 2,816,543 2,338,691
----------- ----------
$ 3,021,060 2,405,915
=========== ==========
See accompanying notes to financial statements.
9
<PAGE>10
THE LORAIN NATIONAL BANK
EMPLOYEE STOCK OWNERSHIP PLAN
Statements of Changes in Assets Available for Distribution to Participants
Years ended December 31, 1994 and 1993
1994 1993
---- ----
Additions
Investment income - dividends and interest $ 77,832 63,594
Employer contribution 375,000 327,000
Net appreciation in fair value of investments
(note 3) 197,709 184,941
----------- ----------
Total additions 650,541 575,535
----------- ----------
Distributions to participants (35,396) (151,063)
----------- ----------
Increase in assets available for distribution
to participants 615,145 424,472
Assets available for distribution to participants
Beginning of year 2,405,915 1,981,443
----------- ----------
End of year $3,021,060 2,405,915
=========== ==========
See accompanying notes to financial statements.
10
<PAGE>11
THE LORAIN NATIONAL BANK
EMPLOYEE STOCK OWNERSHIP PLAN
Notes to Financial Statements
December 31, 1994 and 1993
(1) Description of the Plan
The following description of The Lorain National Bank Employee Stock
Ownership Plan (Plan) provides only general information. Participants
should refer to the Plan agreement for a more complete description of
the Plan's provisions.
(a) General
The Plan is a defined contribution plan sponsored by The Lorain
National Bank (the Bank), a wholly owned subsidiary of LNB
Bancorp, Inc., covering substantially all employees of the Bank.
An employee is eligible to participate in the Plan after the
attainment of age 21 and completion of one year of service, as
defined in the Plan. The Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974 (ERISA).
Under the terms of the Plan, the Trust Department of the Bank acts
as trustee for the Plan and, as such, manages a trust fund which
includes all of the Plan's assets. The trustee has been granted
discretionary authority concerning purchases and sales of
investments in the trust fund made from employer contributions.
(b) Bank Contributions
The amount of the contribution is determined by the Bank's board of
directors in its absolute discretion. The Bank is not required to
make a contribution in any specific year. Contributions are
allocated to participants' accounts in the proportion each
participant's annual compensation bears to the total annual
compensation of all participants for that plan year.
(c) Voluntary Contributions
The Plan does not permit voluntary contributions.
(d) Vesting
Each participant's vested interest in the Bank's contribution is
determined based on the number of years of service, as defined by
the Plan. Forfeitures of nonvested employer contributions are made
available first to reinstate previously forfeited account balances
of former participants. The remaining forfeitures, if any, shall
be used to reduce the contribution of the Bank for the plan year
in which such forfeitures occur.
(Continued)
11
<PAGE>12
THE LORAIN NATIONAL BANK
EMPLOYEE STOCK OWNERSHIP PLAN
Notes to Financial Statements
(e) Distributions Upon Termination of Employment
A participant whose employment terminates by reason of retirement
on their early retirement date or on their normal retirement
date shall receive their vested benefits. The participant may
elect distribution of their vested benefits either in a single
distribution or in annual, semiannual, quarterly, or monthly
installments.
A participant whose employment is terminated for any reason other
than those designated above may receive a single distribution of
their vested benefits.
(f) Plan Termination
Although it has not expressed any intention to do so, the Bank has
the right to terminate the Plan subject to the provisions set
forth in ERISA. In the event of Plan termination, the assets of
the Plan will be allocated as prescribed by ERISA and its related
regulations.
(g) Plan Administrator
The plan administrator is the president and chief operating officer
of the Bank.
(2) Summary of Significant Accounting Policies
(a) Basis of Presentation
The accompanying financial statements of the Plan have been prepared
on an accrual basis and in accordance with generally accepted
accounting principles.
(b) Investments
The fair value of investments and changes therein are determined
through the use of current quoted market values.
(Continued)
12
<PAGE>13
THE LORAIN NATIONAL BANK
EMPLOYEE STOCK OWNERSHIP PLAN
Notes to Financial Statements
(3) Investments
The following table presents the fair values of investments at December
31, 1994 and 1993:
1994 1993
-------------------- --------------------
Number of Number of
Shares or Fair Shares or Fair
Units Value Units Value
--------- ----- --------- -----
Common stock
LNB Bancorp, Inc. 57,466 $ 1,731,163 44,001 $ 1,155,026
Mutual funds
Benchmark Mutual Fund 9,608 96,275 8,500 91,465
United States Treasury Bills
$200,000, 5.830%, due
March 9, 1995 - 197,910 - -
$200,000, 6.330%, due
June 8, 1995 - 194,490 - -
$200,000, 5.200%, due
July 27, 1995 - 192,520 - -
United States Treasury Notes
$240,000, 5.375%, due
April 30, 1994 - - - 241,651
$100,000, 5.000%, due
June 30, 1994 - - - 100,844
$150,000, 4.250%, due
August 31, 1994 - - - 150,798
$150,000, 4.250%, due
October 31, 1994 - - - 150,891
$150,000, 4.250%, due
December 31, 1995 - 145,687 - 149,978
$150,000, 6.875%, due
October 31, 1996 - 147,938 - -
$100,000, 4.375%, due
November 15, 1996 - 94,328 - 99,532
--------- ---------
Total investments $ 2,800,311 $ 2,140,185
========= =========
During the years ended December 31, 1994 and 1993, the Plan's investments
(including investments bought, sold, as well as held during the year)
appreciated (depreciated) in value by $197,709 and $184,941, respectively,
as follows:
1994 1993
---- ----
LNB Bancorp, Inc. $ 220,987 184,296
Mutual funds (6,190) 1,438
United States government securities (17,088) (793)
------- -------
$ 197,709 184,941
======= =======
(Continued)
13
<PAGE>14
THE LORAIN NATIONAL BANK
EMPLOYEE STOCK OWNERSHIP PLAN
Notes to Financial Statements
(4) Administrative Expenses
The administrative expenses of the Plan are paid by the Bank.
(5) Federal Income Taxes
The plan administrator filed for a tax determination letter in 1995;
however, a response is not anticipated until late in 1995. The plan
administrator believes that the Plan qualifies under the applicable
provisions of the Internal Revenue Code.
14
<PAGE>15
Schedule 1
----------
THE LORAIN NATIONAL BANK
EMPLOYEE STOCK OWNERSHIP PLAN
Item 27a - Schedule of Assets Held for Investment
December 31, 1994
Identity of Issuer Description of Investment Cost Fair Value
- ------------------ ------------------------- ---- ----------
Common stock
LNB Bancorp, Inc. 57,466 shares $ 1,149,763 1,731,163
--------- ---------
Mutual funds
Benchmark Mutual Fund 9,608 units 100,000 96,275
--------- ---------
United States government securities
United States Treasury Notes $150,000 par value, due
December 31, 1995 149,914 145,687
$150,000 par value, due
October 31, 1996 149,987 147,938
$100,000 par value, due
November 15, 1996 99,819 94,328
United States Treasury Bills $200,000 par value, due
March 9, 1995 197,052 197,910
$200,000 par value, due
June 8, 1995 193,600 194,490
$200,000 par value, due
July 27, 1995 189,484 192,520
--------- ----------
Total United States
government securities 979,856 972,873
--------- ----------
Total investments $ 2,229,619 2,800,311
========= ==========
See accompanying independent auditor's report.
15
<PAGE>16
Schedule 2
----------
THE LORAIN NATIONAL BANK
EMPLOYEE STOCK OWNERSHIP PLAN
Item 27e - Schedule of Party-in-Interest Transactions
Year ended December 31, 1994
Transactions in common stock of LNB Bancorp Inc., 100 percent owner of the Bank,
during the year ended December 31, 1994:
Number of Fair
Shares Value
--------- -----
Balance at December 31, 1993 44,001 $ 1,155,026
Stock dividend 1,350 -
Purchases 12,216 357,954
Distributions (101) (2,804)
Net appreciation - 220,987
------ ----------
Balance at December 31, 1994 57,466 $ 1,731,163
====== ==========
See accompanying independent auditors' report.
16
<PAGE>17
Schedule 3
----------
THE LORAIN NATIONAL BANK
EMPLOYEE STOCK OWNERSHIP PLAN
Item 27d - Schedule of Reportable Transactions
Year ended December 31, 1994
Amortized
Cost of
Number of Purchase Selling Asset Net
Transactions Description of Assets Price Price Sold Gain
- ------------ --------------------- -------- ------ --------- ----
6 LNB Bancorp, Inc.
Common stock $ 357,954 - - -
3 United States Treasury Bills 580,136 - - -
1 United States Treasury Note 149,987 - - -
4 United States Treasury Notes - 640,000 639,802 198
See accompanying independent auditors' report.
17
<PAGE>18
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the plan administrator has duly caused this annual report to be signed
on its behalf by the undersigned hereunto duly authorized.
THE LORAIN NATIONAL BANK EMPLOYEE STOCK OWNERSHIP PLAN
------------------------------------------------------
(Name of Plan)
Date: June 15, 1995 By: /s/ Gregory D. Friedman
------------- -----------------------
Gregory D. Friedman
Senior Vice President and
Chief Financial Officer
(Acting Chief Accounting Officer)
18
<PAGE>19
The Lorain National Bank
Employee Stock Ownership Plan
Exhibit to Form 11 - K
(for the fiscal year ended December 31, 1994)
S - K Reference Number (24)
Consent of Independent Accountants.
19
<PAGE>20
(LETTERHEAD)
(LOGO)
KPMG Peat Marwick LLP
1500 National City Center
1900 East Ninth Street
Cleveland, OH 44114-3495
Consent of Independent Accountants
----------------------------------
The Board of Directors
LNB Bancorp, Inc.:
We consent to the incorporation by reference in the Registration Statement
No. 33-65036 of LNB Bancorp, Inc. of our report dated April 7, 1995, relating
to the statements of assets available for distribution to participants of
The Lorain National Bank Employee Stock Ownership Plan as of December 31,
1994, and 1993, and the related statements of changes in assets available
for distribution to participants for the years then ended, which report
appears in Amendment No. 2 to the 1994 annual report on Form 10-K of
LNB Bancorp, Inc.
/s/ KPMG Peat Marwick LLP
Cleveland, Ohio
June 15, 1995
(LOGO)
Member Firm of
Klynveld Peat Marwick Goerdeler
20
<PAGE>21
LNB Bancorp, Inc.
Exhibit to Form 10 - K/A
(for the fiscal year ended December 31, 1994)
S - K Reference Number (99.2)
Annual report on Form 11-K of The Lorain National Bank
Stock Purchase Plan (registration number 33-65036)
for the plan year ended December 31, 1994 filed
as an amendment to the annual report on Form 10-K.
21
<PAGE>22
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS AND
SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1994
Note: This Form 11-K is being filed as an amending exhibit to the Form 10-K
of LNB Bancorp, Inc. for the fiscal year ended December 31, 1994
pursuant to Rule 15d-21, therefore no fee is required.
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
---------------- -----------
Commission file number 0-13203
THE LORAIN NATIONAL BANK STOCK PURCHASE PLAN
--------------------------------------------
(Full title of the plan)
Lorain National Bank 457 Broadway Lorain, Ohio 44052-1769
-------------------------------------------------------------
(Name of issuer of the securities held pursuant to the plan and
the address of its principal executive office)
22
<PAGE>23
REQUIRED INFORMATION
Audited plan financial statements and schedules prepared in accordance with
the financial reporting requirements of the Employee Retirement Income
Securities Act of 1974, as amended, are filed herewith in lieu of the
requirements of an audited statement of financial condition and statement of
income and changes in plan equity.
Financial Statements and Exhibits
A) The following financial statements and schedules are filed as
part of this annual report:
1) Statements of Assets Available for Distribution to
Participants - December 31, 1994 and 1993
2) Statements of Changes in Assets Available for Distribution
to Participants - Years ended December 31, 1994 and 1993
3) Notes to Financial Statements - December 31, 1994 and 1993
4) Schedule 1 - Item 27a - Schedule of Assets Held for
Investment - December 31, 1994
5) Schedule 2 - Item 27e - Schedule of Party-in-Interest
Transactions - Year ended December 31, 1994
6) Schedule 3 - Item 27d - Schedule of Reportable Transactions -
Year ended December 31, 1994
B) The following exhibit is filed as part of this annual
report:
24. Consent of Independent Accountants
23
<PAGE>24
(COVER EMBOSSED WITH LOGO)
KPMG Peat Marwick LLP
1500 National City Center
1900 East Ninth Street
Cleveland, OH 44114-3495
The Lorain National Bank
Stock Purchase Plan
Financial Statements and Schedules
December 31, 1994 and 1993
(With Independent Auditors' Report Thereon)
24
<PAGE>25
(LETTERHEAD)
(LOGO)
KPMG Peat Marwick LLP
1500 National City Center
1900 East Ninth Street
Cleveland, OH 44114-3495
Independent Auditors' Report
----------------------------
The Board of Directors
The Lorain National Bank
Sponsor of The Lorain National Bank
Stock Purchase Plan:
We have audited the accompanying statements of assets available for
distribution to participants of The Lorain National Bank Stock Purchase
Plan (Plan) as of December 31, 1994 and 1993, and the related statements
of changes in assets available for distribution to participants for the
years then ended. These financial statements are the responsibility of
the Plan's management. Our responsibility is to express an opinion on
these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the assets available for distribution to
participants of the Plan as of December 31, 1994 and 1993, and the changes
in those assets for the years then ended in conformity with generally accepted
accounting principles.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of
assets held for investment at December 31, 1994 and party-in-interest
and reportable transactions for the year ended December 31, 1994, are
presented for purposes of additional analysis and are not a required
part of the basic financial statements, but are supplementary information
required by the Department of Labor's Rules and Regulations for Reporting
and Disclosure under the Employee Retirement Income Security Act of 1974.
The supplemental schedules have been subjected to the auditing procedures
applied in the audit of the basic financial statements and, in our opinion,
are fairly stated in all material respects in relation to the basic financial
statements taken as a whole.
/s/ KPMG Peat Marwick LLP
Cleveland, Ohio
April 7, 1995
(LOGO)
Member Firm of
Klynveld Peat Marwick Goerdeler
25
<PAGE>26
THE LORAIN NATIONAL BANK
STOCK PURCHASE PLAN
Statements of Assets Available for
Distribution to Participants
December 31, 1994 and 1993
1994 1993
---- ----
Assets
Short-term cash investments $ 105,805 359,799
Investment, at fair value
LNB Bancorp, Inc. common stock 3,296,247 2,523,701
Dividends and interest receivable 18,868 16,331
--------- ---------
Assets available for distribution
to participants $ 3,420,920 2,899,831
========= =========
See accompanying notes to financial statements.
26
<PAGE>27
THE LORAIN NATIONAL BANK
STOCK PURCHASE PLAN
Statements of Changes in Assets Available for
Distribution to Participants
Years ended December 31, 1994 and 1993
1994 1993
---- ----
Additions
Investment income
Dividend and interest income $ 71,294 62,112
Net appreciation in fair value of investment 480,289 437,257
--------- ---------
Total investment income 551,583 499,369
--------- ---------
Contributions
Employer 104,509 87,701
Participants 209,000 175,400
--------- ---------
Total contributions 313,509 263,101
--------- ---------
Total additions 865,092 762,470
Deductions
Distributions to participants (344,003) (409,113)
--------- ---------
Increase in assets available for distribution
to participants 521,089 353,357
Assets available for distribution to participants
Beginning of year 2,899,831 2,546,474
--------- ---------
End of year $ 3,420,920 2,899,831
========= =========
See accompanying notes to financial statements.
27
<PAGE>28
THE LORAIN NATIONAL BANK
STOCK PURCHASE PLAN
Notes to Financial Statements
December 31, 1994 and 1993
(1) Description of the Plan
The following description of The Lorain National Bank Stock Purchase
Plan (Plan) provides only general information. Participants should refer
to the Plan agreement for a more complete description of the Plan's
provisions.
(a) General
The Plan is a defined contribution plan sponsored by The Lorain
National Bank (Bank), a wholly owned subsidiary of LNB Bancorp,
Inc., covering substantially all employees of the Bank. An employee
is eligible to participate in the Plan on the January 1 or July 1
after the attainment of age 21 and completion of one year of service,
as defined in the Plan. The Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974 (ERISA).
Under the terms of the Plan, the Trust Department of the Bank acts
as trustee for the Plan and, as such, manages a trust fund which
includes all of the Plan's assets. The Plan stipulates that employer
and employee contributions will be invested in units of the LNB
Bancorp, Inc. stock fund which primarily consists of stock of
LNB Bancorp, Inc.
(b) Bank Contributions
The Bank is required to contribute to the Plan for each month, out
of its current or accumulated earnings only, an amount equal to 50
percent of the respective participants' contributions for each
month. In 1994, the contribution year was changed to reflect the
calendar year. As a result, thirteen monthly contributions were
made in 1994.
(c) Participants' Contributions
A participant can make, through payroll deductions, contributions
of one (1) to six (6) percent (in whole integers) of their
compensation. Changes in the amount of compensation paid to a
participant will automatically effect a change in the amount of
the contribution.
(d) Vesting of Contributions
Each participant shall have a fully vested interest in the Bank's
and their contributions as of the date payments are made.
(e) Withdrawals While Employed
At any time, subject to certain restrictions, a participant may elect
to withdraw all or a portion of their units.
(Continued)
28
<PAGE>29
THE LORAIN NATIONAL BANK
STOCK PURCHASE PLAN
Notes to Financial Statements
(f) Distributions Upon Termination of Employment
A participant whose employment terminates by reason of retirement
on their early retirement date or on their normal retirement date
shall receive all units credited to their account. The
participant may elect distribution of the units either in a single
distribution or in annual, semiannual, quarterly, or monthly
installments.
A participant whose employment is terminated for any reason other
than those designated above may receive a single distribution of
all units credited to the participant.
(g) Plan Termination
Although it has not expressed any intention to do so, the Bank has
the right to terminate the Plan subject to the provisions set
forth in ERISA. In the event of Plan termination, the assets of
the Plan will be allocated as prescribed by ERISA and its related
regulations.
(h) Plan Administrator
The plan administrator is the president and chief operating officer
of the Bank.
(2) Summary of Significant Accounting Policies
(a) Basis of Presentation
The accompanying financial statements of the Plan have been
prepared on an accrual basis and in accordance with generally
accepted accounting principles.
(b) Investment
The fair value of the investment and changes therein are determined
through the use of current quoted market values.
(c) Reclassifications
Certain items in the 1993 financial statements have been reclassified
to conform with the 1994 presentation.
(Continued)
29
<PAGE>30
THE LORAIN NATIONAL BANK
STOCK PURCHASE PLAN
Notes to Financial Statements
(3) Federal Income Taxes
The Internal Revenue Service issued its latest determination letter on
September 17, 1985 which stated that the Plan and its underlying trust
qualify under the applicable provisions of the Internal Revenue Code
and therefore are exempt from federal income taxes. The Plan and its
underlying trust have subsequently been amended to conform with tax law
changes. In 1995, the amended Plan instruments were submitted to the
Internal Revenue Service for a letter of determination that the Plan
continues to qualify as exempt from federal income taxes; however, a
response is not anticipated until late in 1995. In the opinion of the
plan administrator, the Plan and its underlying trust have operated
within the terms of the Plan and remain qualified under the applicable
provisions of the Internal Revenue Code.
(4) Administrative Expenses
The administrative expenses of the Plan are paid by the Bank.
(5) Plan Units
The Plan assigned a total number of 983,458.7 and 993,844.8 units to
participants at December 31, 1994 and 1993, with a per unit value of
$3.4785 and $2.9178, respectively.
30
<PAGE>31
Schedule 1
----------
THE LORAIN NATIONAL BANK
STOCK PURCHASE PLAN
Item 27a - Schedule of Assets Held for Investment
December 31, 1994
Identity of Issuer Description of Investment Cost Fair Value
- ------------------ ------------------------- ---- ----------
LNB Bancorp, Inc. 109,419 shares of common stock $1,190,174 3,296,247
See accompanying independent auditors' report.
31
<PAGE>32
Schedule 2
----------
THE LORAIN NATIONAL BANK
STOCK PURCHASE PLAN
Item 27e - Schedule of Party-in-Interest Transactions
Year ended December 31, 1994
Transactions in common stock of LNB Bancorp, Inc., 100 percent owner of the
Bank, during the year ended December 31, 1994:
Number
of Shares Fair Value
--------- ----------
Balance at December 31, 1993 96,141 $ 2,523,701
Stock dividend 3,052 -
Purchases 18,991 540,810
Distributions (8,765) (248,553)
Net appreciation - 480,289
--------- ----------
Balance at December 31, 1994 109,419 $ 3,296,247
========= ==========
See accompanying independent auditors' report.
32
<PAGE>33
Schedule 3
----------
THE LORAIN NATIONAL BANK
STOCK PURCHASE PLAN
Item 27d - Schedule of Reportable Transactions
Year ended December 31, 1994
Amortized
Number of Purchase Selling Cost of Net Gain
Transactions Description of Assets Price Price Asset Sold or (Loss)
- ------------ --------------------- -------- ------- ---------- ---------
12 LNB Bancorp, Inc. $540,810 - - -
common stock
See accompanying independent auditors' report.
33
<PAGE>34
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the plan administrator has duly caused this annual report to be signed
on its behalf by the undersigned hereunto duly authorized.
THE LORAIN NATIONAL BANK STOCK PURCHASE PLAN
--------------------------------------------
(Name of Plan)
Date: June 15, 1995 By: /s/ Gregory D. Friedman
------------- ----------------------------
Gregory D. Friedman
Senior Vice President and
Chief Financial Officer
(Acting Chief Accounting Officer)
34
<PAGE>35
The Lorain National Bank
Stock Purchase Plan
Exhibit to Form 11 - K
(for the fiscal year ended December 31, 1994)
S - K Reference Number (24)
Consent of Independent Accountants.
35
<PAGE>36
(LETTERHEAD)
(LOGO)
KPMG Peat Marwick LLP
1500 National City Center
1900 East Ninth Street
Cleveland, Ohio 44114-3495
Consent of Independent Accountants
----------------------------------
The Board of Directors
LNB Bancorp, Inc.:
We consent to the incorporation by reference in the Registration Statement
No. 33-65036 of LNB Bancorp, Inc. of our report dated April 7, 1995, relating
to the statements of assets available for distribution to participants of
The Lorain National Bank Stock Purchase Plan as of December 31, 1994 and
1993, and the related statements of changes in assets available for
distribution to participants for the years then ended, which report appears
in Amendment No. 2 to the 1994 annual report on Form 10-K of LNB Bancorp, Inc.
/s/ KPMG Peat Marwick LLP
Cleveland, Ohio
June 15, 1995
(LOGO)
Member Firm of
Klynveld Peat Marwick Goerdeler
36
