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(Mark One)
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þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
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For the fiscal year ended
December 31, 2015
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or
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|
o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to
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Delaware
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36-2229304
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(State or other jurisdiction of
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(I.R.S. Employer
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incorporation or organization)
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Identification No.)
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common Stock, $1.00 par value
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The NASDAQ Stock Market LLC
(NASDAQ Global Select Market)
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Large accelerated filer
o
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Accelerated filer
þ
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Non-accelerated filer
o
(Do not check if a smaller reporting company)
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Smaller reporting Company
o
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Page #
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Product Category
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Percentage
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Fastening systems
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21%
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Specialty chemicals
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15%
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Fluid power
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15%
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Cutting tools and abrasives
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15%
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Electrical
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12%
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Aftermarket automotive supplies
|
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8%
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Safety
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4%
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Welding and metal repair
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3%
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Other
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7%
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100%
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Name
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Age
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Year First Elected to Present Office
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Position
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Michael G. DeCata
|
|
58
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2012
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President and Chief Executive Officer
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Neil E. Jenkins
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|
66
|
|
2004
|
|
Executive Vice President, Secretary and General Counsel
|
Ronald J. Knutson
|
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52
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2014
|
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Executive Vice President, Chief Financial Officer, Treasurer and Controller
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Shane T. McCarthy
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47
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2015
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Senior Vice President, Supply Chain and Business Development
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Location
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Function
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Approximate Square Footage
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Own/Lease
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Lease Expiration
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|
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Chicago, Illinois
(1)
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Headquarters
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86,300
|
|
Lease
|
|
March 2023
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McCook, Illinois
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Packaging/Distribution
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306,800
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Lease
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June 2022
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Fairfield, New Jersey
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Distribution
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|
60,000
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Own
|
|
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Mississauga, Ontario Canada
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Distribution
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|
78,000
|
|
Own
|
|
|
Reno, Nevada
(2)
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Distribution
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|
105,200
|
|
Lease
|
|
June 2024
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Suwanee, Georgia
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Distribution
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91,200
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Own
|
|
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Decatur, Alabama
(3)
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Lease
|
|
88,200
|
|
Own
|
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(1)
|
We have sub-leased approximately 17,100 feet of the Chicago, Illinois headquarters through March 2023.
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(2)
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In 2014, we completed the sale of our Reno, Nevada, distribution center and entered into an agreement to leaseback approximately one-half of the building for a 10-year term.
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(3)
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In connection with the sale of a discontinued business, we have agreed to lease the Decatur property to the buyer through February, 2019.
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2015
|
2014
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|||||||||||||
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High
|
|
Low
|
|
High
|
|
Low
|
||||||||
First Quarter
|
$
|
27.84
|
|
|
$
|
22.97
|
|
|
$
|
16.25
|
|
|
$
|
12.17
|
|
Second Quarter
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25.00
|
|
|
19.20
|
|
|
17.36
|
|
|
13.11
|
|
||||
Third Quarter
|
28.56
|
|
|
21.10
|
|
|
23.19
|
|
|
15.96
|
|
||||
Fourth Quarter
|
29.64
|
|
|
20.88
|
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|
28.30
|
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20.12
|
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Period
|
|
(a)
Total number of shares (or units) purchased
|
|
(b)
Average price paid per share (or unit)
|
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(c)
Total number of shares (or units) purchased as part of publicly announced plans or programs
|
|
(d)
Maximum number (or approximate dollar value) of shares that may yet be purchased under the plans or programs
|
||||
October 1 to October 31, 2015
|
|
1,383
|
|
|
$
|
21.65
|
|
|
—
|
|
|
—
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November 1 to November 30, 2015
|
|
—
|
|
|
—
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|
|
—
|
|
|
—
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|
December 1 to December 31, 2015
|
|
8,329
|
|
|
23.35
|
|
|
—
|
|
|
—
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Three months ended December 31, 2015
|
|
9,712
|
|
|
|
|
—
|
|
|
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(Dollars in thousands, except per share data)
|
||||||||||||||||||
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2015
(1)
|
|
2014
(2)
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2013
(3)
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2012
(4)
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|
2011
(5)
|
||||||||||
Net sales
|
$
|
275,834
|
|
|
$
|
285,693
|
|
|
$
|
269,503
|
|
|
$
|
273,562
|
|
|
$
|
300,399
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from continuing operations
|
$
|
297
|
|
|
$
|
(6,061
|
)
|
|
$
|
(6,981
|
)
|
|
$
|
(64,033
|
)
|
|
$
|
(4,589
|
)
|
Income (loss) from discontinued operations
|
—
|
|
|
1,692
|
|
|
1,861
|
|
|
1,483
|
|
|
(35
|
)
|
|||||
Net income (loss)
|
$
|
297
|
|
|
$
|
(4,369
|
)
|
|
$
|
(5,120
|
)
|
|
$
|
(62,550
|
)
|
|
$
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(4,624
|
)
|
|
|
|
|
|
|
|
|
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||||||||||
Basic and diluted income (loss) per share of common stock:
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing operations
|
$
|
0.03
|
|
|
$
|
(0.70
|
)
|
|
$
|
(0.81
|
)
|
|
$
|
(7.46
|
)
|
|
$
|
(0.54
|
)
|
Discontinued operations
|
—
|
|
|
0.20
|
|
|
0.22
|
|
|
0.18
|
|
|
—
|
|
|||||
Net income (loss)
|
$
|
0.03
|
|
|
$
|
(0.50
|
)
|
|
$
|
(0.59
|
)
|
|
$
|
(7.28
|
)
|
|
$
|
(0.54
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash dividends declared per share
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.24
|
|
|
$
|
0.48
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
$
|
133,094
|
|
|
$
|
137,840
|
|
|
$
|
159,945
|
|
|
$
|
172,931
|
|
|
$
|
222,748
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Noncurrent liabilities
|
$
|
35,487
|
|
|
$
|
37,257
|
|
|
$
|
39,083
|
|
|
$
|
42,370
|
|
|
$
|
36,697
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Stockholders’ equity
|
$
|
61,264
|
|
|
$
|
61,855
|
|
|
$
|
65,912
|
|
|
$
|
70,733
|
|
|
$
|
134,172
|
|
(1)
|
The 2015 results from continuing operations include an expense of
$0.9 million
related to an increase in the estimated future remediation cost of an environmental matter involving land owned in Decatur, Alabama, that was part of a division that was previously sold.
|
(2)
|
The 2014 results from continuing operations include a $3.0 million impairment charge related to the Reno, Nevada, distribution center and a charge of
$0.3 million
related to the initial estimate of remediation of the environmental matter at the Decatur, Alabama, facility.
|
(3)
|
The 2013 results from continuing operations include a $2.9 million charge related to the sub-lease of a portion of the leased headquarters and a $0.4 million benefit from the resolution of an employment tax matter.
|
(4)
|
The 2012 results from continuing operations include a goodwill impairment charge of $28.3 million, an increase in income tax expense of $33.3 million due to an increase in the deferred tax valuation allowance, a $3.9 million charge related to discontinuing certain products and a $3.7 million gain on the sale of assets.
|
(5)
|
The 2011 results from continuing operations include a $1.2 million provision for the estimated cost of settling an employment tax matter.
|
•
|
North American sales meeting -
This meeting provided our sales representatives with product and sales training, improved awareness of our strategies and allowed them to network with their peers and share best practices. The cost of the 4-day event is viewed as a long-term investment in our sales team. Although our North American sales meeting is not an annual event, we do plan to hold meetings in the future as we value the long-term benefit on our organization.
|
•
|
Increased Sales Team
- We increased the number of net active sales representatives from
916
on December 31, 2014 to
937
on December 31, 2015.
|
•
|
Roll Out of New Sales Ordering Tool
- During 2015, we completed the introduction of a new sales ordering tool allowing our sales team to access real time product pricing and availability in the field.
|
•
|
Acquisition -
We completed an acquisition of a small family-owned auto body parts distributor to complement our Kent Automotive business and increase our presence in Western Canada.
|
•
|
Lean Six Sigma
- We successfully completed six Lean Six Sigma projects including standardizing the training received by all new sales representatives.
|
•
|
Improved Operational Performance
- We continued to improve the fundamentals of our business, measured as improved customer service levels to our customers as well as reduced customer backorders.
|
|
Year Ended December 31,
|
|
Year-to-Year
|
|||||||||||||||||
|
2015
|
|
2014
|
|
Change
|
|||||||||||||||
(Dollars in thousands)
|
Amount
|
|
% of Net Sales
|
|
Amount
|
|
% of Net Sales
|
|
Amount
|
|
%
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Net sales
|
$
|
275,834
|
|
|
100.0
|
%
|
|
$
|
285,693
|
|
|
100.0
|
%
|
|
$
|
(9,859
|
)
|
|
(3.5
|
)%
|
Cost of goods sold
|
106,710
|
|
|
38.7
|
|
|
113,144
|
|
|
39.6
|
|
|
(6,434
|
)
|
|
(5.7
|
)
|
|||
Gross profit
|
169,124
|
|
|
61.3
|
|
|
172,549
|
|
|
60.4
|
|
|
(3,425
|
)
|
|
(2.0
|
)
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Selling expenses
|
90,093
|
|
|
32.7
|
|
|
90,776
|
|
|
31.8
|
|
|
(683
|
)
|
|
(0.8
|
)
|
|||
General and administrative expenses
|
75,979
|
|
|
27.5
|
|
|
83,350
|
|
|
29.1
|
|
|
(7,371
|
)
|
|
(8.8
|
)
|
|||
Total SG&A
|
166,072
|
|
|
60.2
|
|
|
174,126
|
|
|
60.9
|
|
|
(8,054
|
)
|
|
(4.6
|
)
|
|||
Other operating expenses
|
931
|
|
|
0.3
|
|
|
3,386
|
|
|
1.2
|
|
|
(2,455
|
)
|
|
|
||||
Total operating expenses
|
167,003
|
|
|
60.5
|
|
|
177,512
|
|
|
62.1
|
|
|
(10,509
|
)
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating income (loss)
|
2,121
|
|
|
0.8
|
|
|
(4,963
|
)
|
|
(1.7
|
)
|
|
7,084
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Interest and other expenses, net
|
(969
|
)
|
|
(0.4
|
)
|
|
(871
|
)
|
|
(0.3
|
)
|
|
(98
|
)
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Income (loss) from continuing operations before income tax expense
|
1,152
|
|
|
0.4
|
|
|
(5,834
|
)
|
|
(2.0
|
)
|
|
6,986
|
|
|
|
|
|||
Income tax expense
|
855
|
|
|
0.3
|
|
|
227
|
|
|
0.1
|
|
|
628
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Income (loss) from continuing operations
|
$
|
297
|
|
|
0.1
|
%
|
|
$
|
(6,061
|
)
|
|
(2.1
|
)%
|
|
$
|
6,358
|
|
|
|
|
|
Year Ended December 31,
|
|
Year to Year
|
|||||||||||||||||
|
2014
|
|
2013
|
|
Change
|
|||||||||||||||
(Dollars in thousands)
|
Amount
|
|
% of Net Sales
|
|
Amount
|
|
% of Net Sales
|
|
Amount
|
|
%
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Net sales
|
$
|
285,693
|
|
|
100.0
|
%
|
|
$
|
269,503
|
|
|
100.0
|
%
|
|
$
|
16,190
|
|
|
6.0
|
%
|
Cost of goods sold
|
113,144
|
|
|
39.6
|
|
|
108,208
|
|
|
40.2
|
|
|
4,936
|
|
|
4.6
|
|
|||
Gross profit
|
172,549
|
|
|
60.4
|
|
|
161,295
|
|
|
59.8
|
|
|
11,254
|
|
|
7.0
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Selling expenses
|
90,776
|
|
|
31.8
|
|
|
84,273
|
|
|
31.3
|
|
|
6,503
|
|
|
7.7
|
|
|||
General and administrative expenses
|
83,350
|
|
|
29.1
|
|
|
80,357
|
|
|
29.8
|
|
|
2,993
|
|
|
3.7
|
|
|||
Total SG&A
|
174,126
|
|
|
60.9
|
|
|
164,630
|
|
|
61.1
|
|
|
9,496
|
|
|
5.8
|
|
|||
Other operating expenses, net
|
3,386
|
|
|
1.2
|
|
|
2,528
|
|
|
0.9
|
|
|
858
|
|
|
|
||||
Total operating expenses
|
177,512
|
|
|
62.1
|
|
|
167,158
|
|
|
62.0
|
|
|
10,354
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating loss
|
(4,963
|
)
|
|
(1.7
|
)
|
|
(5,863
|
)
|
|
(2.2
|
)
|
|
900
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Interest and other expenses, net
|
(871
|
)
|
|
(0.3
|
)
|
|
(1,259
|
)
|
|
(0.4
|
)
|
|
388
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Loss from continuing operations before income tax (benefit) expense
|
(5,834
|
)
|
|
(2.0
|
)
|
|
(7,122
|
)
|
|
(2.6
|
)
|
|
1,288
|
|
|
|
||||
Income tax (benefit) expense
|
227
|
|
|
0.1
|
|
|
(141
|
)
|
|
0.0
|
|
|
368
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Loss from continuing operations
|
$
|
(6,061
|
)
|
|
(2.1
|
)%
|
|
$
|
(6,981
|
)
|
|
(2.6
|
)%
|
|
$
|
920
|
|
|
|
Quarterly Financial Covenants
|
|
Requirement
|
|
Actual
|
EBITDA to fixed charges ratio
|
|
1.10 : 1.00
|
|
3.12 : 1.00
|
Minimum tangible net worth
|
|
$45.0 million
|
|
$54.0 million
|
(Dollars in thousands)
|
|
|
Payments due in years ended December 31,
|
||||||||||||||||
|
Total
|
|
2016
|
|
2017 – 2018
|
|
2019 - 2020
|
|
Thereafter
|
||||||||||
Revolving line of credit
(1)
|
$
|
925
|
|
|
$
|
925
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Operating leases
(2)
|
14,084
|
|
|
1,763
|
|
|
3,562
|
|
|
3,761
|
|
|
4,998
|
|
|||||
Financing lease obligation
|
8,859
|
|
|
1,165
|
|
|
2,603
|
|
|
2,838
|
|
|
2,253
|
|
|||||
Capital leases
|
381
|
|
|
124
|
|
|
218
|
|
|
39
|
|
|
—
|
|
|||||
Security bonus plan
(3)
|
15,023
|
|
|
382
|
|
|
—
|
|
|
—
|
|
|
14,641
|
|
|||||
Deferred compensation
|
5,442
|
|
|
816
|
|
|
509
|
|
|
259
|
|
|
3,858
|
|
|||||
Purchase commitments
|
8,622
|
|
|
8,622
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Severance obligation
|
697
|
|
|
697
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total contractual cash obligations
|
$
|
54,033
|
|
|
$
|
14,494
|
|
|
$
|
6,892
|
|
|
$
|
6,897
|
|
|
$
|
25,750
|
|
(1)
|
The revolving line of credit with The PrivateBank expires in August 2017. Due to the lock box arrangement and a subjective acceleration clause contained in the borrowing agreement, the revolving line of credit is classified as a current contractual obligation.
|
(2)
|
Operating lease obligations are partially offset by future proceeds of
$0.7 million
from a sub-lease expiring in March 2023.
|
(3)
|
Payments to participants in our security bonus plan are made on a lump sum basis at time of separation from the Company. Payouts for known separation dates have been included in the scheduled year of payout, while payouts for unknown separation dates are reflected in the thereafter column.
|
|
|
|
|
|
|
|
|
Consolidated Statements of Cash Flows for the Years ended December 31, 2015, 2014 and 2013
|
|
|
|
|
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
10,765
|
|
|
$
|
4,207
|
|
Restricted cash
|
800
|
|
|
800
|
|
||
Accounts receivable, less allowance for doubtful accounts of $543 and $733, respectively
|
27,231
|
|
|
31,546
|
|
||
Inventories, net
|
44,095
|
|
|
44,517
|
|
||
Miscellaneous receivables and prepaid expenses
|
3,667
|
|
|
5,433
|
|
||
Total current assets
|
86,558
|
|
|
86,503
|
|
||
|
|
|
|
||||
Property, plant and equipment, less accumulated depreciation and amortization
|
35,487
|
|
|
41,588
|
|
||
Cash value of life insurance
|
10,245
|
|
|
9,188
|
|
||
Deferred income taxes
|
51
|
|
|
51
|
|
||
Other assets
|
753
|
|
|
510
|
|
||
Total assets
|
$
|
133,094
|
|
|
$
|
137,840
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Revolving line of credit
|
$
|
925
|
|
|
$
|
—
|
|
Accounts payable
|
9,370
|
|
|
7,867
|
|
||
Accrued expenses and other liabilities
|
26,048
|
|
|
30,861
|
|
||
Total current liabilities
|
36,343
|
|
|
38,728
|
|
||
|
|
|
|
||||
Security bonus plan
|
14,641
|
|
|
15,857
|
|
||
Financing lease obligation
|
8,539
|
|
|
9,414
|
|
||
Deferred compensation
|
4,626
|
|
|
5,102
|
|
||
Deferred rent liability
|
3,912
|
|
|
4,361
|
|
||
Other liabilities
|
3,769
|
|
|
2,523
|
|
||
Total liabilities
|
71,830
|
|
|
75,985
|
|
||
|
|
|
|
||||
Commitments and contingencies – Note 11
|
|
|
|
|
|
||
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $1 par value:
|
|
|
|
||||
Authorized - 500,000 shares, issued and outstanding - None
|
—
|
|
|
—
|
|
||
Common stock, $1 par value:
|
|
|
|
||||
Authorized - 35,000,000 shares
Issued – 8,796,264 and 8,720,350 shares, respectively Outstanding – 8,771,120 and 8,706,467 shares, respectively |
8,796
|
|
|
8,720
|
|
||
Capital in excess of par value
|
9,877
|
|
|
8,701
|
|
||
Retained earnings
|
43,572
|
|
|
43,275
|
|
||
Treasury stock – 25,144 and 13,883 shares held, respectively
|
(515
|
)
|
|
(267
|
)
|
||
Accumulated other comprehensive income
|
(466
|
)
|
|
1,426
|
|
||
Total stockholders’ equity
|
61,264
|
|
|
61,855
|
|
||
Total liabilities and stockholders’ equity
|
$
|
133,094
|
|
|
$
|
137,840
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Net sales
|
$
|
275,834
|
|
|
$
|
285,693
|
|
|
$
|
269,503
|
|
Cost of goods sold
|
106,710
|
|
|
113,144
|
|
|
108,208
|
|
|||
Gross profit
|
169,124
|
|
|
172,549
|
|
|
161,295
|
|
|||
|
|
|
|
|
|
||||||
Operating expenses:
|
|
|
|
|
|
||||||
Selling expenses
|
90,093
|
|
|
90,776
|
|
|
84,273
|
|
|||
General and administrative expenses
|
75,979
|
|
|
83,350
|
|
|
80,357
|
|
|||
Total SG&A
|
166,072
|
|
|
174,126
|
|
|
164,630
|
|
|||
Other operating expenses, net
|
931
|
|
|
3,386
|
|
|
2,528
|
|
|||
Operating expenses
|
167,003
|
|
|
177,512
|
|
|
167,158
|
|
|||
|
|
|
|
|
|
||||||
Operating income (loss)
|
2,121
|
|
|
(4,963
|
)
|
|
(5,863
|
)
|
|||
|
|
|
|
|
|
||||||
Interest expense
|
(766
|
)
|
|
(772
|
)
|
|
(1,097
|
)
|
|||
Other expenses, net
|
(203
|
)
|
|
(99
|
)
|
|
(162
|
)
|
|||
|
|
|
|
|
|
||||||
Income (loss) from continuing operations before income taxes
|
1,152
|
|
|
(5,834
|
)
|
|
(7,122
|
)
|
|||
Income tax expense (benefit)
|
855
|
|
|
227
|
|
|
(141
|
)
|
|||
|
|
|
|
|
|
||||||
Income (loss) from continuing operations
|
297
|
|
|
(6,061
|
)
|
|
(6,981
|
)
|
|||
Income and gain from discontinued operations, net of tax
|
—
|
|
|
1,692
|
|
|
1,861
|
|
|||
Net Income (loss)
|
$
|
297
|
|
|
$
|
(4,369
|
)
|
|
$
|
(5,120
|
)
|
|
|
|
|
|
|
||||||
Basic and diluted income (loss) per share of common stock:
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
0.03
|
|
|
$
|
(0.70
|
)
|
|
$
|
(0.81
|
)
|
Discontinued operations
|
—
|
|
|
0.20
|
|
|
0.22
|
|
|||
Net income (loss)
|
$
|
0.03
|
|
|
$
|
(0.50
|
)
|
|
$
|
(0.59
|
)
|
|
|
|
|
|
|
||||||
Comprehensive income (loss)
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
297
|
|
|
$
|
(4,369
|
)
|
|
$
|
(5,120
|
)
|
Other comprehensive loss, net of tax:
|
|
|
|
|
|
||||||
Adjustment for foreign currency translation
|
(1,892
|
)
|
|
(559
|
)
|
|
(573
|
)
|
|||
Comprehensive loss
|
$
|
(1,595
|
)
|
|
$
|
(4,928
|
)
|
|
$
|
(5,693
|
)
|
|
Common
Stock,
$1 par value
|
|
Capital in Excess of Par Value
|
|
Retained Earnings
|
|
Treasury Stock
|
|
Accumulated Other Comprehensive income (loss)
|
|
Total stockholders' equity
|
||||||||||||
Balance at January 1, 2013
|
$
|
8,615
|
|
|
$
|
6,951
|
|
|
$
|
52,764
|
|
|
$
|
(155
|
)
|
|
$
|
2,558
|
|
|
$
|
70,733
|
|
Net loss
|
—
|
|
|
—
|
|
|
(5,120
|
)
|
|
—
|
|
|
—
|
|
|
(5,120
|
)
|
||||||
Adjustment for foreign currency translation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(573
|
)
|
|
(573
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
904
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
904
|
|
||||||
Shares issued
|
56
|
|
|
(56
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Share repurchase under stock award program
|
—
|
|
|
—
|
|
|
—
|
|
|
(32
|
)
|
|
—
|
|
|
(32
|
)
|
||||||
Balance at December 31, 2013
|
8,671
|
|
|
7,799
|
|
|
47,644
|
|
|
(187
|
)
|
|
1,985
|
|
|
65,912
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net loss
|
—
|
|
|
—
|
|
|
(4,369
|
)
|
|
—
|
|
|
—
|
|
|
(4,369
|
)
|
||||||
Adjustment for foreign currency translation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(559
|
)
|
|
(559
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
951
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
951
|
|
||||||
Shares issued
|
49
|
|
|
(49
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Share repurchase under stock award program
|
—
|
|
|
—
|
|
|
—
|
|
|
(80
|
)
|
|
—
|
|
|
(80
|
)
|
||||||
Balance at December 31, 2014
|
8,720
|
|
|
8,701
|
|
|
43,275
|
|
|
(267
|
)
|
|
1,426
|
|
|
61,855
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income
|
—
|
|
|
—
|
|
|
297
|
|
|
—
|
|
|
—
|
|
|
297
|
|
||||||
Adjustment for foreign currency translation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,892
|
)
|
|
(1,892
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
1,252
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,252
|
|
||||||
Shares issued
|
76
|
|
|
(76
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Share repurchase under stock award program
|
—
|
|
|
—
|
|
|
—
|
|
|
(248
|
)
|
|
—
|
|
|
(248
|
)
|
||||||
Balance at December 31, 2015
|
$
|
8,796
|
|
|
$
|
9,877
|
|
|
$
|
43,572
|
|
|
$
|
(515
|
)
|
|
$
|
(466
|
)
|
|
$
|
61,264
|
|
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Operating activities
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
297
|
|
|
$
|
(4,369
|
)
|
|
$
|
(5,120
|
)
|
Income from discontinued operations
|
—
|
|
|
(1,692
|
)
|
|
(1,861
|
)
|
|||
Income (loss) from continuing operations
|
297
|
|
|
(6,061
|
)
|
|
(6,981
|
)
|
|||
Adjustments to reconcile income (loss) from continuing operations to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
8,543
|
|
|
8,751
|
|
|
9,030
|
|
|||
Deferred income taxes
|
—
|
|
|
8
|
|
|
13
|
|
|||
Stock-based compensation
|
2,093
|
|
|
6,376
|
|
|
2,267
|
|
|||
Loss (gain) on disposal of property and equipment
|
8
|
|
|
142
|
|
|
(4
|
)
|
|||
Increase in environmental reserve
|
931
|
|
|
340
|
|
|
—
|
|
|||
Long-lived asset impairment
|
—
|
|
|
3,046
|
|
|
—
|
|
|||
Loss on sub-lease
|
—
|
|
|
—
|
|
|
2,538
|
|
|||
Increase in restricted cash
|
—
|
|
|
—
|
|
|
(800
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
3,285
|
|
|
(2,415
|
)
|
|
(941
|
)
|
|||
Inventories, net
|
(116
|
)
|
|
882
|
|
|
(1,404
|
)
|
|||
Prepaid expenses and other assets
|
418
|
|
|
(2,202
|
)
|
|
6,391
|
|
|||
Accounts payable and other liabilities
|
(6,352
|
)
|
|
(7,166
|
)
|
|
(9,410
|
)
|
|||
Other
|
207
|
|
|
633
|
|
|
(180
|
)
|
|||
Net cash provided by operating activities
|
$
|
9,314
|
|
|
$
|
2,334
|
|
|
$
|
519
|
|
|
|
|
|
|
|
||||||
Investing activities
|
|
|
|
|
|
||||||
Purchases of property, plant and equipment
|
$
|
(2,342
|
)
|
|
$
|
(2,759
|
)
|
|
$
|
(2,908
|
)
|
Proceeds from sale of property
|
3
|
|
|
8,307
|
|
|
38
|
|
|||
Business acquisition
|
(441
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds related to the sale of businesses, net
|
—
|
|
|
12,125
|
|
|
—
|
|
|||
Net cash (used in) provided by investing activities
|
$
|
(2,780
|
)
|
|
$
|
17,673
|
|
|
$
|
(2,870
|
)
|
|
|
|
|
|
|
||||||
Financing activities
|
|
|
|
|
|
||||||
Net proceeds from (payments on) revolving line of credit
|
$
|
925
|
|
|
$
|
(16,078
|
)
|
|
$
|
(49
|
)
|
Proceeds from stock option exercises
|
50
|
|
|
53
|
|
|
—
|
|
|||
Net cash provided by (used in) financing activities
|
$
|
975
|
|
|
$
|
(16,025
|
)
|
|
$
|
(49
|
)
|
|
|
|
|
|
|
||||||
Discontinued operations
|
|
|
|
|
|
||||||
Operating cash flows
|
$
|
(29
|
)
|
|
$
|
(530
|
)
|
|
$
|
1,666
|
|
Investing cash flows
|
—
|
|
|
—
|
|
|
(257
|
)
|
|||
Net cash (used in) provided by discontinued operations
|
$
|
(29
|
)
|
|
$
|
(530
|
)
|
|
$
|
1,409
|
|
|
|
|
|
|
|
||||||
Effect of exchange rate changes on cash and cash equivalents
|
(922
|
)
|
|
57
|
|
|
49
|
|
|||
|
|
|
|
|
|
||||||
Increase (decrease) in cash and cash equivalents
|
6,558
|
|
|
3,509
|
|
|
(942
|
)
|
|||
Cash and cash equivalents at beginning of year
|
4,207
|
|
|
698
|
|
|
1,640
|
|
|||
Cash and cash equivalents at end of year
|
$
|
10,765
|
|
|
$
|
4,207
|
|
|
$
|
698
|
|
|
(Dollars in thousands)
|
||||||
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
Inventories, gross
|
$
|
49,615
|
|
|
$
|
50,063
|
|
Reserve for obsolete and excess inventory
|
(5,520
|
)
|
|
(5,546
|
)
|
||
Inventories, net
|
$
|
44,095
|
|
|
$
|
44,517
|
|
|
(Dollars in thousands)
|
||||||
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
Land
|
$
|
2,692
|
|
|
$
|
2,701
|
|
Buildings and improvements
|
18,343
|
|
|
18,503
|
|
||
Machinery and equipment
|
22,558
|
|
|
22,418
|
|
||
Capitalized software
|
19,710
|
|
|
18,758
|
|
||
McCook Facility
|
12,961
|
|
|
12,961
|
|
||
Furniture and fixtures
|
5,693
|
|
|
5,703
|
|
||
Capital leases
|
563
|
|
|
302
|
|
||
Vehicles
|
163
|
|
|
168
|
|
||
Construction in progress
|
681
|
|
|
1,018
|
|
||
|
83,364
|
|
|
82,532
|
|
||
Accumulated depreciation and amortization
|
(47,877
|
)
|
|
(40,944
|
)
|
||
|
$
|
35,487
|
|
|
$
|
41,588
|
|
|
(Dollars in thousands)
|
||||||||||
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
United States
|
$
|
3,583
|
|
|
$
|
(4,355
|
)
|
|
$
|
(6,255
|
)
|
Canada
|
(2,431
|
)
|
|
(1,479
|
)
|
|
(867
|
)
|
|||
|
$
|
1,152
|
|
|
$
|
(5,834
|
)
|
|
$
|
(7,122
|
)
|
|
(Dollars in thousands)
|
||||||
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
Accrued stock-based compensation
|
$
|
6,980
|
|
|
$
|
7,121
|
|
Accrued compensation
|
6,289
|
|
|
9,783
|
|
||
Accrued and withheld taxes, other than income taxes
|
1,199
|
|
|
1,440
|
|
||
Financing lease obligation
|
876
|
|
|
809
|
|
||
Accrued profit sharing
|
774
|
|
|
582
|
|
||
Reserve for unrecognized tax benefits
|
738
|
|
|
879
|
|
||
Accrued health benefits
|
700
|
|
|
810
|
|
||
Accrued severance
|
697
|
|
|
311
|
|
||
Other
|
7,795
|
|
|
9,126
|
|
||
|
$
|
26,048
|
|
|
$
|
30,861
|
|
a)
|
80%
of the face amount of the Company’s eligible accounts receivable, generally less than
60
days past due, and
|
b)
|
the lesser of
50%
of the lower of cost or market value of the Company’s eligible inventory, generally inventory expected to be sold within
18
months, or
$20.0 million
.
|
Quarterly Financial Covenants
|
|
Requirement
|
|
Actual
|
EBITDA to fixed charges ratio
|
|
1.10 : 1.00
|
|
3.12 : 1.00
|
Minimum tangible net worth
|
|
$45.0 million
|
|
$54.0 million
|
|
(Dollars in thousands)
|
||||||||||
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Beginning balance
|
$
|
311
|
|
|
$
|
1,769
|
|
|
$
|
4,417
|
|
Charged to earnings
|
1,273
|
|
|
631
|
|
|
837
|
|
|||
Cash paid
|
(887
|
)
|
|
(2,089
|
)
|
|
(3,485
|
)
|
|||
Ending balance
|
$
|
697
|
|
|
$
|
311
|
|
|
$
|
1,769
|
|
Expected volatility
|
33.9% to 57.2%
|
Risk-free rate of return
|
0.2% to 1.7%
|
Expected term (in years)
|
0.2 to 4.5
|
Expected annual dividend
|
$0
|
|
Number of SPRs
|
|
Weighted Average Exercise Price
|
|||
Outstanding on December 31, 2014
|
644,691
|
|
|
$
|
14.50
|
|
Granted
|
409,373
|
|
|
28.17
|
|
|
Exercised
|
(64,300
|
)
|
|
11.88
|
|
|
Cancelled
|
(30,265
|
)
|
|
33.34
|
|
|
Outstanding on December 31, 2015
|
959,499
|
|
|
19.91
|
|
|
|
|
|
|
|||
Exercisable on December 31, 2015
|
462,725
|
|
|
$
|
14.04
|
|
|
Restricted Stock Awards
|
|
Outstanding on December 31, 2014
|
38,123
|
|
Granted
|
22,820
|
|
Exchanged for shares
|
(29,958
|
)
|
Outstanding on December 31, 2015
|
30,985
|
|
|
Number of Market Stock Units
|
|
Maximum Shares Potentially Issuable
|
||
Outstanding on December 31, 2014
|
88,600
|
|
|
132,900
|
|
Granted
|
30,633
|
|
|
45,949
|
|
Exchanged for shares
|
(24,493
|
)
|
|
(36,739
|
)
|
Cancelled
|
(6,970
|
)
|
|
(10,455
|
)
|
Outstanding on December 31, 2015
|
87,770
|
|
|
131,655
|
|
|
Number of Stock Options
|
|
Weighted Average Exercise Price
|
|||
Outstanding on December 31, 2014
|
5,910
|
|
|
$
|
14.04
|
|
Granted
|
40,000
|
|
|
28.40
|
|
|
Outstanding on December 31, 2015
|
45,910
|
|
|
26.55
|
|
|
(Dollars in thousands)
|
||||||||||
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Environmental remediation expense
|
$
|
931
|
|
|
$
|
340
|
|
|
$
|
—
|
|
Impairment loss
|
—
|
|
|
3,046
|
|
|
—
|
|
|||
Loss on sub-lease transaction
|
—
|
|
|
—
|
|
|
2,928
|
|
|||
Employment tax matter
|
—
|
|
|
—
|
|
|
(400
|
)
|
|||
Total other operating expenses, net
|
$
|
931
|
|
|
$
|
3,386
|
|
|
$
|
2,528
|
|
|
(Dollars in thousands, except per share data)
|
||||||||||
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Weighted average shares:
|
|
|
|
|
|
||||||
Basic weighted average shares outstanding
|
8,726
|
|
|
8,683
|
|
|
8,634
|
|
|||
Effect of dilutive securities outstanding
|
150
|
|
|
—
|
|
|
—
|
|
|||
Diluted weighted average shares outstanding
|
8,876
|
|
|
8,683
|
|
|
8,634
|
|
|||
|
|
|
|
|
|
||||||
Earnings (loss):
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
297
|
|
|
$
|
(6,061
|
)
|
|
$
|
(6,981
|
)
|
Discontinued operations
|
—
|
|
|
1,692
|
|
|
1,861
|
|
|||
Net earnings (loss)
|
$
|
297
|
|
|
$
|
(4,369
|
)
|
|
$
|
(5,120
|
)
|
|
|
|
|
|
|
||||||
Basic and diluted earnings (loss) per share of common stock:
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
0.03
|
|
|
$
|
(0.70
|
)
|
|
$
|
(0.81
|
)
|
Discontinued operations
|
—
|
|
|
0.20
|
|
|
0.22
|
|
|||
Net earnings (loss)
|
$
|
0.03
|
|
|
$
|
(0.50
|
)
|
|
$
|
(0.59
|
)
|
|
(Dollars in thousands)
|
||||||||||
|
Year Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
2013
|
||||||
Net sales
|
|
|
|
|
|
||||||
United States
|
$
|
251,129
|
|
|
$
|
257,428
|
|
|
$
|
241,115
|
|
Canada
|
24,705
|
|
|
28,265
|
|
|
28,388
|
|
|||
Consolidated total
|
$
|
275,834
|
|
|
$
|
285,693
|
|
|
$
|
269,503
|
|
|
|
|
|
|
|
||||||
Long-lived assets
|
|
|
|
|
|
||||||
United States
|
$
|
33,379
|
|
|
$
|
39,171
|
|
|
$
|
56,162
|
|
Canada
|
2,108
|
|
|
2,417
|
|
|
2,812
|
|
|||
Consolidated total
|
$
|
35,487
|
|
|
$
|
41,588
|
|
|
$
|
58,974
|
|
|
(Dollars in thousands, except per share data)
|
||||||||||||||
|
2015 Quarter Ended
|
||||||||||||||
|
Dec. 31
|
|
Sep. 30
|
|
Jun. 30
|
|
Mar. 31
|
||||||||
Net sales
|
$
|
64,961
|
|
|
$
|
70,243
|
|
|
$
|
70,726
|
|
|
$
|
69,904
|
|
Gross profit
|
39,091
|
|
|
43,342
|
|
|
43,808
|
|
|
42,883
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Income (loss) from continuing operations
(1)
|
$
|
(3,688
|
)
|
|
$
|
2,430
|
|
|
$
|
2,926
|
|
|
$
|
(1,371
|
)
|
Income from discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net income (loss)
|
$
|
(3,688
|
)
|
|
$
|
2,430
|
|
|
$
|
2,926
|
|
|
$
|
(1,371
|
)
|
|
|
|
|
|
|
|
|
||||||||
Basic income (loss) per share of common stock:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
(0.42
|
)
|
|
$
|
0.28
|
|
|
$
|
0.34
|
|
|
$
|
(0.16
|
)
|
Discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net income (loss)
|
$
|
(0.42
|
)
|
|
$
|
0.28
|
|
|
$
|
0.34
|
|
|
$
|
(0.16
|
)
|
|
|
|
|
|
|
|
|
||||||||
Diluted income (loss) per share of common stock:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
(2)
|
$
|
(0.42
|
)
|
|
$
|
0.27
|
|
|
$
|
0.33
|
|
|
$
|
(0.16
|
)
|
Discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net income (loss)
(2)
|
$
|
(0.42
|
)
|
|
$
|
0.27
|
|
|
$
|
0.33
|
|
|
$
|
(0.16
|
)
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(Dollars in thousands, except per share data)
|
||||||||||||||
|
2014 Quarter Ended
|
||||||||||||||
|
Dec. 31
|
|
Sep. 30
|
|
Jun. 30
|
|
Mar. 31
|
||||||||
Net sales
|
$
|
70,281
|
|
|
$
|
74,128
|
|
|
$
|
72,080
|
|
|
$
|
69,204
|
|
Gross profit
|
42,935
|
|
|
44,533
|
|
|
43,803
|
|
|
41,278
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Income (loss) from continuing operations
(3)
|
$
|
(2,997
|
)
|
|
$
|
460
|
|
|
$
|
798
|
|
|
$
|
(4,322
|
)
|
Income and gain from discontinued operations
|
325
|
|
|
—
|
|
|
—
|
|
|
1,367
|
|
||||
Net income (loss)
|
$
|
(2,672
|
)
|
|
$
|
460
|
|
|
$
|
798
|
|
|
$
|
(2,955
|
)
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted income (loss) per share of common stock:
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
$
|
(0.34
|
)
|
|
$
|
0.05
|
|
|
$
|
0.09
|
|
|
$
|
(0.50
|
)
|
Discontinued operations
(2)
|
0.03
|
|
|
—
|
|
|
—
|
|
|
0.16
|
|
||||
Net income (loss)
(2)
|
$
|
(0.31
|
)
|
|
$
|
0.05
|
|
|
$
|
0.09
|
|
|
$
|
(0.34
|
)
|
(1)
|
Loss from continuing operations for the three months ended December 31, 2015 includes an expense of
$0.9 million
related to an increase in the estimated future remediation cost of an environmental matter involving land owned in Decatur, Alabama, that was part of a division that was previously sold.
|
(2)
|
The sum of the quarterly earnings per share amounts may not equal the total annual earnings per share due to rounding and the uneven timing of earnings throughout the year compared to the weighted average shares outstanding.
|
(3)
|
Loss from continuing operations for the three months ended March 31, 2014 includes a
$2.9 million
impairment charge related to the Reno, Nevada distribution center.
|
|
(Dollars in thousands)
|
||||||||||||||
Description
|
Balance at Beginning of Period
|
|
Charged to Costs and Expenses
|
|
Deductions
|
|
Balance at End of Period
|
||||||||
Allowance for doubtful accounts:
|
|
|
|
|
|
|
|
||||||||
Year ended December 31, 2015
|
$
|
733
|
|
|
$
|
353
|
|
|
$
|
(543
|
)
|
(1)
|
$
|
543
|
|
Year ended December 31, 2014
|
828
|
|
|
715
|
|
|
(810
|
)
|
(1)
|
733
|
|
||||
Year ended December 31, 2013
|
1,637
|
|
|
126
|
|
|
(935
|
)
|
(1)
|
828
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Valuation allowance for deferred tax assets:
|
|
|
|
|
|
|
|
||||||||
Year ended December 31, 2015
|
$
|
36,675
|
|
|
$
|
(159
|
)
|
|
$
|
—
|
|
|
$
|
36,516
|
|
Year ended December 31, 2014
|
35,834
|
|
|
841
|
|
|
—
|
|
|
36,675
|
|
||||
Year ended December 31, 2013
|
34,278
|
|
|
1,556
|
|
|
—
|
|
|
35,834
|
|
(1)
|
Uncollected receivables written off, net of recoveries and translation adjustments.
|
Plan category
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights
(1)
|
|
Weighted-average exercise price of outstanding options, warrants and rights
(1) (2)
|
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in the first column)
|
Equity compensation plans approved by security holders
|
286,550
|
|
$16.13
|
|
579,006
|
Equity compensation plans not approved by security holders
|
—
|
|
—
|
|
—
|
Total
|
286,550
|
|
$16.13
|
|
579,006
|
(1)
|
Includes potential common stock issuance of
30,985
from restricted stock awards,
131,655
from market stock units
45,910
from stock options and
78,000
from stock awards.
|
(2)
|
Weighted-average exercise price of
45,910
stock options and
78,000
stock awards.
|
LAWSON PRODUCTS, INC
|
||
|
|
|
By:
|
/s/ Michael G. DeCata
|
|
|
|
|
|
Michael G. DeCata
|
|
|
President, Chief Executive Officer and Director
|
|
|
(principal executive officer)
|
|
|
|
|
|
Date:
|
February 18, 2016
|
By:
|
/s/ Ronald J. Knutson
|
|
|
|
|
|
Ronald J. Knutson
|
|
|
Executive Vice President, Chief Financial Officer, Treasurer and Controller
|
|
|
(principal financial and accounting officer)
|
|
|
|
|
|
Date:
|
February 18, 2016
|
Signature
|
|
Title
|
/s/ Ronald B. Port
|
|
Chairman of the Board
|
Ronald B. Port
|
|
|
/s/ Andrew B. Albert
|
|
Director
|
Andrew B. Albert
|
|
|
/s/ I. Steven Edelson
|
|
Director
|
I. Steven Edelson
|
|
|
/s/ James S. Errant
|
|
Director
|
James S. Errant
|
|
|
/s/ Lee S. Hillman
|
|
Director
|
Lee S. Hillman
|
|
|
/s/ Thomas S. Postek
|
|
Director
|
Thomas S. Postek
|
|
|
/s/ Wilma J. Smelcer
|
|
Director
|
Wilma J. Smelcer
|
|
|
Exhibit
Number
|
|
Description of Exhibit
|
3.1
|
|
Certificate of Incorporation of the Company, as amended, incorporated herein by reference to Exhibit 3(a) to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1988.
|
3.2
|
|
Amended and Restated By-laws of the Company, incorporated herein by reference to Exhibit 3.1 to the Company's Current Report on Form 8-K dated October 20, 2009.
|
10.1*
|
|
Amended and Restated Executive Deferral Plan, incorporated herein by reference from Exhibit 10(c)(7) to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995.
|
10.2*
|
|
Lawson Products, Inc. Stock Performance Plan, incorporated herein by reference from Exhibit 10(c)(8) to the Company’' Annual Report on Form 10-K for the fiscal year ended December 31, 2000.
|
10.3*
|
|
Form Letter regarding Stock Performance Rights, incorporated by reference to Exhibit 10(c)(16) to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2004.
|
10.4*
|
|
Lawson Products, Inc. Long-Term Incentive Plan, incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated May 13, 2008.
|
10.5*
|
|
Form of Indemnification Agreement for Directors and Officers incorporated herein by reference to Exhibit 10.01 to the Company's Current Report on Form 8-K dated September 15, 2008.
|
10.6*
|
|
Form of Amended and Restated Award Agreement, incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K dated February 12, 2009.
|
10.7
|
|
Loan and Security Agreement dated August 8, 2012 between the Company and The PrivateBank and Trust Company, incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated August 8, 2012.
|
10.8*
|
|
Employment Agreement dated as of August 29, 2012 by and between Lawson Products, Inc., an Illinois corporation, and Neil E. Jenkins, incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K dated August 29, 2012.
|
10.9*
|
|
Employment Agreement dated as of August 29, 2012 by and between Lawson Products, Inc., an Illinois corporation, and Ron Knutson, incorporated herein by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K dated August 29, 2012.
|
10.10
|
|
First Amendment to Loan and Security Agreement dated September 25, 2013 between the Company and The PrivateBank and Trust Company, incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated September 25, 2013.
|
10.11
|
|
Second Amendment to Loan and Security Agreement dated December 20, 2013 between the Company and The PrivateBank and Trust Company, incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated December 20, 2013.
|
10.12
|
|
Third Amendment to Loan and Security Agreement dated February 14, 2013 between the Company and The PrivateBank and Trust Company incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated February 14, 2014.
|
10.13
|
|
Real Estate Sales Contract and Escrow Instructions dated May 12, 2014 between the Company and KTR Property Trust III incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated May 12, 2014.
|
10.14
|
|
Agreement of Lease dated June 30, 2014 between the Company and KTR Property Trust III incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated June 30, 2014.
|
10.15*
|
|
Employment Agreement dated as of January 12, 2015 by and between Lawson Products, Inc., an Illinois corporation, and Michael G. DeCata, incorporated herein by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K dated January 12, 2015.
|
10.16*
|
|
Award Agreement dated as of January 12, 2015 by and between Lawson Products, Inc., an Illinois corporation, and Michael G. DeCata, incorporated herein by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K dated January 12, 2015.
|
10.17*
|
|
Confidential Separation Agreement and General Release dated as of September 15, 2015, between Lawson Products, Inc. and Allen D. Jacobson, incorporated by reference to Exhibit 99.1to the Company's Current Report on Form 8-K dated September 15, 2015.
|
10.18
|
|
Consent to Loan and Security Agreement dated September 30, 2015 between the Company and The PrivateBank and Trust Company.
|
10.19*
|
|
Change in Control Agreement effective October 16, 2015 by and between the Company and Shane McCarthy, incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated October 16, 2015
|
21
|
|
Subsidiaries of the Company.
|
23
|
|
Consent of BDO USA, LLP.
|
31.1
|
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
31.2
|
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32
|
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS
|
|
XBRL Instance Document
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
BORROWERS:
|
LAWSON PRODUCTS, INC.
, a Delaware corporation
|
|
|
By:
|
/s/ Ronald J. Knutson
|
|
|
Ronald J. Knutson
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
LAWSON PRODUCTS, INC.
, an Illinois corporation
|
|
|
By:
|
/s/ Ronald J. Knutson
|
|
|
Ronald J. Knutson
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
SANDALWOOD DIVESTITURE COMPANY, INC.
, an Alabama corporation
|
|
|
By:
|
/s/ Ronald J. Knutson
|
|
|
Ronald J. Knutson
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
BARON DIVESTITURE COMPANY
, an Illinois corporation
|
|
|
By:
|
/s/ Ronald J. Knutson
|
|
|
Ronald J. Knutson
|
|
|
Executive Vice President and Chief Financial Officer
|
LENDER:
|
THE PRIVATEBANK AND TRUST COMPANY
|
|
|
By:
|
/s/ Joseph G. Fudacz
|
|
|
Joseph G. Fudacz
|
|
|
Managing Director
|
Name
|
|
Jurisdiction of Incorporation
|
|
|
|
Lawson Products, Inc.
|
|
Illinois
|
Lawson Products Inc. (Ontario)
|
|
Ontario, Canada
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|