SecProbe.io

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-4631

       DIVISION OF
CORPORATION FINANCE

Mail Stop 4631         December 31, 2009    F. Terrence Blanchard Chief Financial Officer Lawson Products, Inc.
1666 East Touhy Avenue Des Plains, Illinois 60018
Re: Lawson Products, Inc.
Form 10-K for Fiscal Year Ended December 31, 2008
  File No. 0-10546

Dear Mr. Blanchard:
We have reviewed your filing and have the following comments.  Where
indicated, we think you should re vise your document in response to these comments.  If
you disagree, we will consider your explanation as to why our comment is inapplicable or
a revision is unnecessary.  Please be as deta iled as necessary in your explanation.  In
some of our comments, we may ask you to provi de us with information so we may better
understand your disclosure.  After reviewing th is information, we may raise additional
comments.   Please understand that the purpose of our re view process is to assist you in your
compliance with the applicable disclosure  requirements and to  enhance the overall
disclosure in your filing.  We look forward to  working with you in these respects.  We
welcome any questions you may have about our comments or any other aspect of our review.  Feel free to call us at the telephone numbers listed at the end of this letter.
 FORM 10-K FOR FISCAL YE AR ENDED DECMEBER 31, 2008

Item 7. Management’s Discussion and Analysis, page 13
Liquidity and Capital Resources, page 16

1. In future filings please disclose the Am ended Credit Facility’s specific covenant
ratios.

Terrence Blanchard
Lawson Products, Inc.
December 31, 2009
Page 2
Critical Accounting Policies, page 18

2. Based on the significance of your goodw ill balance, the goodwill impairment
charge you recorded in 2008, and your ma rket capitalization relative to the
carrying value of equity, please revise future filings to include a critical accounting policy detailing your process for evaluating goodwill impairment.  Refer to Section 501.14 of the Financial Reporting Codification, SFAS 142, and
Release No. 33-8350, Interpretation- Commission’s Guidance Regarding
Management’s Discussion and Analysis of Financial Condition and Results of
Operations on our website at http://www.sec.gov/rules/interp/33-
8350.htm#P180_57133  for guidance.  Please supple mentally provide us your
proposed disclosures.
 3. Please clarify how you determine your reporting units under SFAS 142.  To the
extent that any of your reporting units ha ve estimated fair values that are not
substantially in excess of their carry ing value and goodwill for these reporting
units, in the aggregate or individually , could materially impact your operating
results, please identify those repor ting units and provide the following
disclosures:
• The percentage by which fair value ex ceeds carrying value as of the most-
recent step-one test.
• The amount of goodwill allocate d to the reporting unit.
• A description of the assumptions that drive the estimated fair value.
• A discussion of any uncertainties as sociated with the key assumptions.
For example, to the extent that you have included assumptions in your discounted cash flow model that de viate from your historical results,
please include a discussi on of these assumptions.
• A discussion of any potential events, trends and/or circumstances that
could have a negative effect on estimated fair value.
• Any other material and useful information you gather and analyze regarding the risks of re coverability of goodwill.
If you have determined that estimated fair values substantially exceed carrying values for all of your reporting units, pleas e disclose that determination.  Refer to
Item 303 of Regulation S-K and Sec tions 216 and 501.14 of the Financial
Reporting Codification for guidance.
 Note E – Goodwill, page 31

 4.  Please expand your disclosures in future filings to describe the specific facts,
circumstances, and changed assumptions that resulted in the goodwill impairment
that you recorded during the fourth quart er of 2008 in accordance with paragraph
47 of SFAS 142.

Terrence Blanchard
Lawson Products, Inc.
December 31, 2009
Page 3
Controls and Procedures, page 43

5. We note that your description of your disc losure controls and procedures does not
appear to conform to the definition provided in Rules 13a-15(e) and 15d-15(e) of the Exchange Act.  In future filings, please revise your statement to ensure you
describe your disclosure controls and procedures in accordance with the two-part definition provided in Rules 13a-15(e) and 15d-15(e) of the Exchange Act or simply state whether they are effective.  Please confirm to us supplementally that
your disclosure control and procedures we re effective in acco rdance with the two-
part definition.
 FORM 10-K/A FILED APRIL 20, 2009

 Compensation Discussion & Analysis, page 5

Elements of Total Compensation, page 7
Annual Incentive Plan (“AIP”), page 8
 6. We note your disclosure in the table pr esenting the target bonuses and actual
bonuses received in 2008.  Please tell us supplementally, with a view toward future disclosure, whether you assigned pa rticular weightings to each individual
performance goals you identify for each na med executive in the fourth paragraph
of this section to calculate  the “Bonus Awarded” column of the table.  If you did
not establish weightings for each individua l performance measure, please tell us
how you ultimately determined the amount in the Bonus Awarded column for each named executive officer.  See
 Item 402(b)(1)(v) of Regulation S-K.
 2004-2008 Long-Term Capital Accumulation Plan (“LTCAP”), page 9

 7. Please tell us supplementally, with a view  toward future disclosure, the overall
LTCAP pool amount as calculated pursuant to the first full paragraph on page 10.
 Stock Performance Rights (“SPRs”), page 11

 8. In future filings, please disclose how you determine the amount of SPRs awarded
to each named executive officer.   See
 Item 402(b)(1)(v) of Regulation S-K.

Certain Relationships and Re lated Transactions, page 27

9. In future filings, please disclose whet her your related party transaction policies
and procedures are in writing and, if not , how such policies and procedures are
evidenced.  See Item 404(b)(1)(iv) of Regulation S-K.
 10. In future filings, pursuant to paragraph (b) of Item 404 of Regulation S-K, please
describe your policies and procedures for review, approval, and ratification of any
transaction required to be disclosed under paragraph (a) of Item 404.  In

Terrence Blanchard
Lawson Products, Inc.
December 31, 2009
Page 4
particular, this includes a di scussion of the standards to  be applied pursuant to
such policies and procedures.

FORM 10-Q FOR THE PREIOD ENDED SEPTEMBER 30, 2009
 Item 2. Management’s Discussion and Analysis, page 12

 11. We note your disclosures on pages 13 a nd 14 that the 2008 gross margin included
a $2.4 million favorable inventory reserve ad justment.  Please explain to us your
basis for recording a favorable inventory reserve adjustment since it appears to us that when an inventory reserve is reco rded it establishes a new cost basis.
 FORM 8-K FILED AUGUST 25, 2009

 12. Please file a complete copy of th e Credit Agreement dated August 21, 2009,
including all schedules and exhibits thereto, with your next Exchange Act report.

Please respond to these comments within  10 business days or tell us when you
will provide us with a response.  Please furnish a letter that keys your responses to our comments and provides any requested information.  Detailed letters greatly facilitate our
review.  Please understand that we may have  additional comments after reviewing your
responses to our comments.   We urge all persons who are responsible for the accuracy and adequacy of the disclosure in the filing to be certain that the filing includes all in formation required under
the Securities Exchange Act of 1934 and th at they have provided all information
investors require for an informed invest ment decision.  Since the company and its
management are in possession of all facts re lating to a company’s disclosure, they are
responsible for the accuracy and adequacy of the disclosures they have made.
  In connection with responding to our comments, please provide, in writing, a statement from the company acknowledging that:
• the company is responsible for the adequacy and accuracy of the disclosure in
the filing;

• staff comments or changes to disclosure  in response to staff comments do not
foreclose the Commission from taking a ny action with respect to the filing;
and
 • the company may not assert staff comme nts as a defense in any proceeding
initiated by the Commission or any pers on under the federal s ecurities laws of
the United States.

Terrence Blanchard
Lawson Products, Inc. December 31, 2009
Page 5
In addition, please be advise d that the Division of Enfo rcement has access to all
information you provide to the staff of the Divi sion of Corporation Fi nance in our review
of your filing or in response to our comments on your filing.
  You may contact Bret Jo hnson, Staff Accountant, at  (202) 551-3753 or Anne
McConnell, Senior Staff Acc ountant, at (202) 551-3709 if you have questions regarding
the financial statements and related commen ts.  Please contact Chambre Malone, Staff
Attorney, at (202) 551-3262 or  Craig Slivka, Special Counsel, at (202) 551-3729 if you
have any other questions.
Sincerely,    John Hartz Senior Assistant Chief Accountant