EXHIBIT 10(C)(8)
LAWSON PRODUCTS, INC.
STOCK PERFORMANCE PLAN
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1. PURPOSE. The purpose of the Lawson Products, Inc. Stock Performance
Plan (the "Plan") is to attract and retain outstanding individuals as officers
and key employees of Lawson Products, Inc. (the "Company") and to furnish
performance-based incentives to such persons by providing opportunities to
participate in the growth in value of the Company on advantageous terms as
herein provided. No shares of Lawson Common Stock will be issued under the Plan
but participants will be able to receive the gain in value of Lawson Common
Stock, in cash.
2. ADMINISTRATION. The Plan shall be administered by the Compensation
Committee of the Board of Directors of the Company (the "Committee"). The
Committee shall interpret the Plan, prescribe, amend and rescind rules and
regulations relating thereto and make all other determinations necessary or
advisable for the administration of the Plan. Any interpretation or construction
by the Committee of any provision of the Plan or any award granted under it
shall be final. No member of the Committee shall be liable for any action or
determination made in good faith with respect to the Plan or any award granted
under it.
3. PARTICIPANTS. Participants in the Plan will consist of such key
management employees of the Company as the Committee in its sole discretion may
designate from time to time to receive awards hereunder. The Committee's
designation of a participant in any year shall not require the Committee to
designate such person to receive an award in any other year. Nothing in the Plan
or any award under it shall limit in any way the right of the Company to
terminate any participant's employment at any time nor confer upon any employee
any right to continue in the employ of the Company for any period of time.
4. AWARDS. All awards under the Plan shall be granted in the form of
stock performance rights, in accordance with the following terms:
(a) The Committee shall determine the number of shares of Common Stock
subject to each stock performance right, the term of each right, and
subject to the following, any other terms and conditions applicable
thereto.
(b) Each stock performance right will entitle the holder to elect to
receive the appreciation in the fair market value of the shares subject
thereto up to the date the right is exercised. Such
appreciation shall be measured from the initial value established by the
Committee which shall be not less than the fair market value of the Common
Stock of the Company on the date the right is granted.
(c) The fair market value of the Company's Common Stock shall be the
closing price of a share of Lawson Common Stock on the relevant date, as
reported on NASDAQ or any exchange on which the Common Stock is then
listed.
(d) Each stock performance right will be exercisable at the time and
to the extent established by the Committee at the time of grant. Payment of
the appreciation shall be made in cash as soon as practicable following
exercise.
(e) The terms of each award shall indicate what rights, if any, the
participant or his estate shall have in such award in the event of the
death, total permanent disability, retirement or other termination of
employment of the participant.
(f) In the event of a change of control, as hereinafter defined, all
of the rights then outstanding under the Plan shall be deemed fully vested
and exercised on the date of the transaction and the appreciation shall be
paid as soon as possible to the holders thereof.
(g) A "change of control" shall be deemed to have occurred on the
first date on which either: (i) any "person" is or becomes the beneficial
owner (as defined in Rule 13d-3 under the Securities Exchange Act of 1934
(the "Exchange Act")), directly or indirectly of securities of the Company
representing at least thirty (30) percent of the combined voting power of
the Company's then outstanding securities, or (ii) a majority of the
individuals comprising the Company's Board of Directors are not Continuing
Directors, or (iii) the Company is involved in any merger, consolidation,
share exchange or any other transaction if, after the consummation thereof,
the holders of the voting securities of the Company immediately prior
thereto do not own at least a majority of the combined voting power of the
surviving or resulting corporation, or (iv) all or substantially all of the
assets of the Company are sold or otherwise transferred, or (v) a change
occurs of a nature that would be required to be reported in response to
Item 6(e) of Schedule 14A of Regulation 14A, promulgated under the Exchange
Act, or any other successor disclosure item.
(h) A "person" means a person, (as such term is used in Sections 13(d)
and 14(d) of the Exchange Act) but excluding Sidney L. Port, the estate of
Bettie Port, their descendants, their spouses,
and trusts, partnerships or other entities for the benefit of any such
persons, or in which any such persons have a controlling interest.
(i) A "Continuing Director" means an individual who was a member of
the Board of Directors of the Company immediately prior to the transaction
or election or other event which resulted in a Change of Control or who was
designated (before his initial election or appointment as a director) as a
Continuing Director by a majority of the whole Board of Directors but only
if the majority of the whole Board of Directors then consisted of
Continuing Directors or, if a majority of the whole Board of Directors
shall not then consist of Continuing Directors, by a majority of the then
Continuing Directors.
5. NONTRANSFERABILITY. All stock performance rights granted under the
Plan shall not be transferable other than by will or the laws of descent and
distribution and shall be exercisable during the participant's lifetime only by
the participant or the participant's guardian or legal representative.
6. OTHER PROVISIONS. The grant of any stock performance right under the
Plan may also be subject to other provisions (whether or not applicable to the
rights awarded to any other participant) including conditions precedent to the
right to exercise, as the Committee determines appropriate, including such
provisions as may be required to comply with federal or state securities laws
and stock exchange requirements and understandings or conditions as to the
participant's employment.
7. ADJUSTMENT PROVISIONS.
(a) If the Company shall at any time change the number of shares of
Common Stock outstanding without new consideration to the Company, a
corresponding increase shall be made in the number of shares covered by
each outstanding right and a decrease shall be made in the initial value of
each right so that the aggregate net benefit to the participant shall not
be changed. If the Company shall at any time decrease the number of shares
of Common Stock outstanding without any distribution to its stockholders, a
corresponding decrease shall be made in the number of shares covered by
each outstanding right and an increase shall be made in the initial value
of each right so that the aggregate net benefit to the participant shall
not be changed.
(b) In the event of a reorganization, recapitalization or other change
in the shares of Common Stock outstanding, the Committee shall make
whatever changes in the Plan and in any rights then outstanding it deems
necessary or appropriate.
8. TAXES. The Company shall be entitled to withhold the amount of any
tax attributable to the exercise of any right under the Plan and may defer
making payment or delivery as to any exercise if any such tax is payable until
indemnified to its satisfaction.
9. TERM OF PROGRAM; AMENDMENT OR CANCELLATION OF BENEFITS. The Plan
shall continue in effect until terminated by the Committee pursuant to Section
10. The terms and conditions applicable to any rights granted hereunder may at
any time be amended or cancelled by mutual agreement between the Committee and
the participant or any other person as may then have an interest therein and may
be unilaterally modified by the Committee whenever such modification is deemed
necessary to protect the Company.
10. AMENDMENT OR DISCONTINUATION OF PLAN. The Committee may amend,
suspend or discontinue the Plan at any time; provided, however, that no such
action shall adversely affect any outstanding stock performance right.