Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On February 23, 2009, the Compensation Committee of the Board of Directors adopted and approved the Lance, Inc. 2009 Three-Year Performance Incentive Plan for Officers and Key Managers (the "2009 Plan") under the Lance, Inc. 2007 Key Employee Incentive Plan. Under the 2009 Plan, each officer of the Company participating in the Plan was assigned a target incentive based on market and peer group data. The following target incentives were assigned to the Company's named executive officers: Mr. Singer-$1,296,000, Mr. Puckett-$330,800, Mr. Patcha-$281,300, Mr. Thompson-$247,300 and Mr. Leake-$257,000.
In accordance with the 2009 Plan, each named executive officer was granted
(i) nonqualified stock options valued at 35% of his target incentive,
(ii) restricted shares of common stock valued at 30% of his target incentive and
(iii) a performance award ("Performance Award") with a target payout equal to 35% of his target incentive. Each stock option granted under the 2009 Plan will have an exercise price equal to $21.71 and will vest in three substantially equal installments beginning February 23, 2010. Each share of restricted stock granted on February 23, 2009 will also vest in three substantially equal installments beginning on February 23, 2010. Payouts under each Performance Award will be determined based on the attainment of certain predetermined goals with respect to the following performance measures: (1) average net sales for 2009 and 2010 (weighted at 30%),
(2) average corporate earnings per share for 2009 and 2010 (weighted at 40%) and
(3) average return on capital employed for 2009 and 2010 (weighted at 30%). With respect to each performance measure, the Compensation Committee established
(1) a threshold level of performance under which each participant will be entitled to 50% of the weighted target incentive, (2) a target level of performance under which each participant will be entitled to 100% of the weighted target incentive, and (3) a maximum level of performance under which each participant will be entitled to a maximum of 250% of the weighted target incentive. Payouts with respect to the Performance Award portion of the target incentive will be calculated on a straight line basis between the threshold and target level and between the target and maximum level for net sales. The Performance Awards will be settled in common stock in early 2011. Two-thirds of such shares of common stock will be fully vested upon payout in 2011 with the balance vesting one year later.

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