UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No.     )

Filed by the Registrant  x                             Filed by a Partyparty other than the Registrant  ¨

Check the appropriate box:

Dorman Products, Inc.

(Name of Registrant as Specified In Its Charter)

Not Applicable

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

Notice of Annual Meeting of Shareholders

May 15, 20122015

Dear Shareholder:

All shareholders of Dorman Products, Inc., a Pennsylvania corporation, referred to as “we,” “our,” “us,” and the “Company” herein, are cordially invited to attend the Annual Meeting of Shareholders to be held at the law offices of Dorman Products, Inc., 3400 East WalnutBlank Rome LLP, One Logan Square, 130 N. 18^th Street, Colmar,Philadelphia, Pennsylvania 1891519103 on Tuesday,Friday May 15, 20122015 at 8:30 a.m., Eastern Daylight Time, for the following purposes:

Only shareholders of record as of the close of business on March 23, 2012,18, 2015, referred to as the “record date,” are entitled to notice of and to vote at the annual meeting and any postponements or adjournments thereof.

If the annual meeting is adjourned because of the absence of a quorum, those shareholders entitled to vote who attend the adjourned annual meeting, although constituting less than a quorum as provided herein, shall nevertheless constitute a quorum for the purpose of electing directors. If the annual meeting is adjourned for one or more periods aggregating at least fifteen (15) days because of the absence of a quorum, those shareholders entitled to vote who attend the reconvened annual meeting, if less than a quorum as determined under applicable law, shall nevertheless constitute a quorum for the purpose of acting upon any matter set forth in this Notice of Annual Meeting of Shareholders.

The Notice of Internet Availability of Proxy Materials will be mailed to our shareholders of record on the record date on or about April 4, 2012, other2, 2015,other than those shareholders who previously requested electronic or paper delivery of proxy materials from us who will receive copies of the proxy materials as requested. The Notice of Internet Availability of Proxy Materials contains instructions on how to access an electronic copy of our proxy materials.

Your vote is important. Whether or not you attend the meeting, we urge you to vote promptly.

Important Notice Regarding the Availability of Proxy Materials for the

Shareholder Meeting to Be Held on May 15, 2012:

2015: The proxy statement, the form of proxy

and the 20112014 Annual Report to Shareholders are available at www.proxyvote.com.www.proxyvote.com.

Dorman Products, Inc.

3400 East Walnut Street

Colmar, Pennsylvania 18915

Proxy Statement

This proxy statement and the accompanying proxy card are for the solicitation of proxies by the Board of Directors, referred to as the “Board,” of Dorman Products, Inc., a Pennsylvania corporation, referred to as “we”, “our”, “us”,“we,” “our,” “us,” and the “Company” herein, for use at our Annual Meeting of Shareholders to be held on Tuesday,Friday, May 15, 20122015 at 8:30 a.m., Eastern Daylight Time, and any postponements or adjournments of the annual meeting. The annual meeting will be held at our corporate headquarters at 3400 East Walnutthe law offices of Blank Rome LLP, One Logan Square, 130 N. 18^th Street, Colmar, PA 18915.Philadelphia, Pennsylvania 19103. This proxy statement, the accompanying proxy card and the 20112014 Annual Report to Shareholders are posted on the Internet atwww.proxyvote.com and the Notice of Internet Availability of Proxy Materials will be mailed to our shareholders on or about April 4, 2012.2, 2015. If you previously requested electronic or paper delivery of the proxy materials, you will be sent the proxy statement, the accompanying proxy card and the 20112014 Annual Report to Shareholders on or about April 4, 2012.2, 2015.

The Board has fixed the close of business on March 23, 201218, 2015 as the “record date” for the determination of shareholders entitled to receive notice of, and to vote at, the annual meeting and any postponements or adjournments of the annual meeting. As of the close of business on the record date, there were 18,087,87735,599,194 shares of our common stock, par value $0.01 per share, outstanding, eachoutstanding. Shareholders have cumulative voting rights in the election of which is entitled todirectors and one vote per share on all other matters to be presented at the annual meeting. Cumulative voting allows a shareholder to multiply the total number of shares that such shareholder is entitled to vote by the number of directors to be elected and to cast an equal number of votes for each of the five nominees, distribute their votes among as many nominees as they choose, or cast all their votes for one nominee.

A proxy is your legal designation of another person, also referred to as the “proxy,” to vote on your behalf. By properly signing and returning the enclosed proxy card or by voting by Internet or telephone, you are giving the persons who our Board designated as proxies the authority to vote your shares in the manner that you indicate on your proxy card or by voting by Internet or telephone.

At the annual meeting, shareholders will consider and vote upon:

(i) the election of five directors, as described in this proxy statement;

(ii) the ratification of KPMG LLP as our independent registered public accounting firm for the 2012 fiscal year; and

(iii) such other business as may properly come before the annual meeting or any postponement or adjournment thereof.

The Board is not aware of any other matters that will come before the annual meeting or any postponement or adjournment thereof. If any other matters properly come before the meeting or any postponement or adjournment thereof, the persons designated as proxies intend to vote in accordance with their best judgment on such matters.

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If you are a registered shareholder (that is, if your shares are registered in your name with our transfer agent), you can vote your shares in any of the following ways:

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If you are voting by proxy, cumulative voting can only be processed by utilizing the proxy card method of voting. Whether or not you plan to attend the annual meeting, we urge you to vote promptly using one of these methods to ensure your vote is counted.

Please note that although there is no charge to you for voting electronically via the Internet or by telephone, there may be costs associated with electronic or telephonic access such as usage charges of Internet service providers and telephone companies. We do not cover these costs; they are solely your responsibility.

If you vote electronically via the Internet or by telephone, you will need your “Shareholder Control Number”control number (your Shareholder Control Numbercontrol number can be found in the bottom right hand corner ofon the Notice of Internet Availability of Proxy Materials)Materials and your proxy card). Your vote electronically via the Internet or by telephone must be received by 11:59 p.m., Eastern Daylight Time, on May 14, 2012.2015. If you vote electronically via the Internet or by telephone, you do not need to return your proxy card.

If you are a beneficial owner of shares held in “street name” (that is, if shares you own are registered in the name of your broker, bank or other nominee), you need to check the materials provided to you by your broker, bank or other nominee to determine how you may vote your shares. As a beneficial owner, you have the right to direct the broker, bank or other nominee holding your shares on how to vote the shares held in your account using the voting instructions received from such organization. The availability of Internet or telephone voting will depend on the voting process of your broker, bank or other nominee. Shares held in “street name” may be voted in person at the annual meeting only if you obtain a legal proxy from the broker, bank or other nominee giving you the right to vote the shares.

If you are a beneficial owner of shares held in street name and do not provide the broker, bank or other nominee that holds your shares with specific voting instructions, under the rules of various national and regional securities exchanges, the broker, bank or other nominee that holds your shares may generally vote on “routine” matters but cannot vote on “non-routine” matters. If the broker, bank or other nominee that holds your shares does not receive instructions from you on how to vote your shares on a non-routine matter, the organization that holds your shares will not be able to vote your shares on such matter, often referred to as a broker non-vote. The election of directors is considered non-routine under applicable regulatory rules. The ratification of the appointment of KPMG LLP as our independent registered public accounting firm for the 20122015 fiscal year is considered routine under applicable regulatory rules.

If you are a participant in the Dorman Products, Inc. 401(k) Retirement Plan and Trust, referred to as the “401(k) Retirement Plan,” and shares of common stock of the Company are credited to your plan account, you have the right to direct Vanguard Fiduciary Trust Company, trustee of the 401(k) Retirement Plan, on how to vote such shares. To provide instruction to the trustee on how to vote your plan shares, simply vote your plan shares in the manner described by the accompanying proxy card, which permits voting electronically via the Internet, by telephone or in writing. The trustee of the 401(k) Retirement Plan will have the votes of each participant tabulated by Broadridge and will vote the 401(k) Retirement Plan’s shares on a basis proportionally consistent with the tabulated votes of such participants by submitting a final proxy card representing the plan shares for inclusion in the tally at the annual meeting. If you do not vote the plan shares credited to your account, the trustee will not have direction as to how to vote such shares and you will be treated as directing the trustee to vote your plan shares in the same proportion as the shares for which the trustee has received timely instruction from others who do vote. To allow sufficient time for the trustee to vote your plan shares, your vote must be received by 11:59 p.m., Eastern Daylight Time, on May 8, 2015.

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Proxies may be revoked at any time prior to being voted at the annual meeting. You may revoke a proxy before its exercise by filing written notice of revocation with our Assistant SecretaryBroadridge before the annual meeting.meeting (notice of revocation must be received by the day before the annual meeting). After voting, you may change your vote one or more times by completing and returning a later dated proxy to our Assistant Secretary,Broadridge, by voting again by Internet or telephone as described in this proxy statement, or by voting in person at the annual meeting. Attendance at the annual meeting will not in itself constitute a revocation of your proxy. You may request a new proxy card from our Assistant Secretary.Broadridge. The last vote received chronologically will supersede any prior votes. The deadline for registered shareholders to change their vote by Internet or telephone is 11:59 p.m., Eastern Daylight Time, on May 14, 2012.2015 (mailed proxy cards must be received by the day before the annual meeting). All requests and correspondence with our Assistant SecretaryBroadridge should be mailed to Dorman Products, Inc., 3400 East Walnut Street, Colmar, Pennsylvania 18915, Attention: Thomas J. Knoblauch, Assistant Secretary.Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, New York 11717. If you are a beneficial owner of shares of common stock held in street name, please review the voting instructions provided by the broker, bank or other nominee holding your shares or contact such organization regarding how to change your vote. If you are a participant in the 401(k) Retirement Plan and shares of common stock of the Company are credited to your plan account, you may revoke a proxy before its exercise by filing written notice of revocation with Broadridge and you may change your vote one or more times by completing and returning a later dated proxy to Broadridge or by voting again by Internet or telephone as described in the accompanying proxy card. The deadline for participants in the 401(k) Retirement Plan to revoke or change their vote is 11:59 p.m., Eastern Daylight Time, on May 8, 2015 (notices of revocation and mailed proxy cards must be received by May 8, 2015).

If you are a registered shareholder and you return an executed proxy but do not specify how to vote, your shares will be voted: (i) “FOR” the election of the five nominees for director named in “Proposal I—I – Election of Directors” of this proxy statement; and (ii) “FOR” the ratification of the appointment of KPMG LLP as our independent registered public accounting firm for the 20122015 fiscal year. In addition,If you return an executed proxy card with no further instructions on the election of directors, the persons named in the accompanying proxy card have discretionary authority to cumulate votes and to allocate such votes among some or all of the nominees recommended by the Board, although they have no present intention of doing so. The proxy also confers discretionary authority to vote with respect to any and all of the following matters that may come before the annual meeting: (i) matters to be presented at the annual meeting of which we did not have notice on or prior to February 18, 2012;15, 2015; (ii) approval of the minutes of the prior meeting of shareholders if such approval does not amount to ratification of the action taken at such meeting; (iii) the election of any person to any office for which a bona fide nominee named in this proxy statement is unable to serve or for good cause will not serve; (iv) any proposal omitted from this proxy statement and form of proxy pursuant to Rules 14a-8 or 14a-9 under the Securities Exchange Act of 1934, as amended, referred to as the “Exchange Act”;Act;” and (v) matters incident to the conduct of the annual meeting.

If any other matters properly come before the annual meeting, the persons named in the accompanying proxy card will vote in accordance with their best judgment.

A quorum of shareholders is necessary to hold a valid annual meeting. Presence at the annual meeting in person or by proxy of the holders of a majority of our issued and outstanding common stock at the close of business on the record date is necessary to constitute a quorum. If the annual meeting is adjourned because of the absence of a quorum, those shareholders entitled to vote who attend the adjourned annual meeting, although constituting less than a quorum as provided herein, shall nevertheless constitute a quorum for the purpose of electing directors. If the annual meeting is adjourned for one or more periods aggregating at least 15 days due to the absence of a quorum, shareholders who are entitled to vote and who attend the adjourned annual meeting, even though they do not constitute a quorum at the adjourned meeting, will constitute a quorum for the purpose of acting on any matter described in the Notice of Annual Meeting of Shareholders.

The five director candidates who receive the most “FOR” votes will be elected to serve on the Board. Shareholders have cumulative voting rights in the election of directors. When voting for directors, shareholders may multiply the total number of shares that they are entitled to vote by the number of directors to be elected and may then cast an equal number of votes for each of the five nominees, distribute their votes among as many nominees as they choose, or cast all of their votes for one nominee. The ratification of the appointment of KPMG LLP as our

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independent registered public accounting firm for the 20122015 fiscal year, and the approval of any other business as may properly come before the annual meeting, or any postponement or adjournment thereof, will require the affirmative vote of the majority of the votes cast. Only votes “FOR” or “AGAINST” such proposals will be counted. AbstentionsUnder Pennsylvania law, an abstention, withholding authority to vote or a broker non-vote is not considered a vote “cast” and broker non-votestherefore will have no effect on whether any of the proposals has received the required shareholder vote. All shares present in person or represented by proxy (including abstentions and broker non-votes) are counted for quorum purposes.

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Governance of the Company

The Board of Directors and Director Independence.The Board currently consists of fivesix members. The Board has four standing committees: (i) the Executive Committee; (ii) the Audit Committee; (iii) the Compensation Committee; and (iv) the Corporate Governance and Nominating Committee. The Lead Director serves on the Audit Committee, the Compensation Committee and the Executive Committee and as Chairman of the Corporate Governance and Nominating Committee.

The Board has determined that the following current directors, constituting a majority of the members of the Board, are independent as defined in the applicable listing standards of The NASDAQ Stock Market, LLC, referred to as “NASDAQ”: John F. Creamer, Jr., Paul R. Lederer, Edgar W. Levin, Robert M. Lynch and Richard T. Riley.

Under applicable Securities and Exchange Commission, referred to as the “SEC,” and NASDAQ rules, the existence of certain “related party”person” transactions in excess of certain thresholds between a director and the Company are required to be disclosed and may preclude a finding by the Board that the director is independent. A director is not considered “independent” unless the Board affirmatively determines that the director has no material relationship with us that, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. During the Board’s review of director independence, no transactions or relationships between the Company and independent directors or any member of their immediate family (or any entity of which an independent director or an immediate family member is an executive officer, general partner or significant equity holder) were identified which would render the directors named above not independent.

Board Leadership and Risk Management.The Board does not have a policy regarding the separation of the roles of Chief Executive Officer and Chairman of the Board as the Board believes it is in the best interests of the Company to make that determination based on the position and direction of the Company and the membership of the Board. Steven L. Berman assumedhas served in the role of Chief Executive Officer and Chairman of the Board upon the passing of his brother, Richard N. Berman, insince January 2011. Prior to such time, Richard Berman served as Chairman and Chief Executive Officer of the Company. The Board has a Lead Director, Paul R. Lederer.

We have a relatively small board of directors, a majority of which is independent under the listing standards of NASDAQ. Each independent director has direct access to our Chairman and Chief Executive Officer and our Lead Director, as well as other members of the senior management team. We believe that having such direct access, along with the presence of a Lead Director, makes the separation of the principal executive officer and board chairman positions unnecessary. In our view, the independent Board members are capable of performing their duties without the expense and administrative layer associated with the separation of the principal executive officer and board chairman positions. The independent directors meet in executive session without management present at least quarterly.

The Board believes that the Company’s Chief Executive Officer is best situated to serve as Chairman of the Board because he is the director most familiarof his familiarity with the Company’s business and industry, and most capable ofhis ability to effectively identifyingidentify strategic priorities and leadinglead the discussion and execution of our corporate strategy. Independent directors and management have different views and roles in the development of a strategic plan. The Board believes that the combined role of Chairman of the Board and Chief Executive Officer promotes efficiency, strategy development and execution, and facilitates information flow between management and the Board, which are essential to effective governance. In addition, the Board believes the combined role of the Chairman of the Board and the Chief Executive Officer, together with an independent Lead Director having the duties described below, is in the best interest of shareholders because it provides the appropriate balance between strategy development and independent oversight of management.

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The Board takes an active role,,as a whole and at the committee level, in overseeing the management of the Company’s risks. The Board regularly reviews information regarding the Company’s operations, financial condition, and liquidity, as well as the risks associated with each. The Company’s Audit Committee supervises the management of financial risks and potential conflicts of interests. The Company’s Compensation Committee is responsible for overseeing the management of risks associated with the Company’s executive compensation plans and arrangements. The Corporate Governance and Nominating Committee manages risks associated with the independence of the Board and the duties and responsibilities of its members. While each committee is responsible for evaluating certain risks and overseeing the management of such risks, the entire Board is regularly informed through attendance at committee meetings or committee reports about such risks. In addition,Additionally, we have a Risk and Compliance Committee made up of members of senior management periodically provide reportsthat evaluates the risks posed to the Board about their respective areasCompany and the Company’s responses to those risks. The Risk and Compliance Committee performs detailed reviews of responsibilitythe Company’s risks and any risks associatedmonitors the Company’s compliance with their areas. Theseapplicable laws, regulations and frameworks, and reports includeits actions taken by senior management to monitor and control risks.the Board.

We believe that our leadership structure is appropriate given our management structure and operational characteristics.

Lead Director. As a matter of good corporate governance, the Board has adopted a practice of appointing a Lead Director. The Lead Director is charged with (i) presiding at all meetings of the Board at which the Chairman of the Board is not present, including executive sessions of the independent directors; (ii) serving as a liaison between the Chairman of the Board and the independent directors; (iii) assisting the Chairman of the Board in setting the Board’s schedules, agendas, and information flow; (iv) participating (in conjunction with the Compensation Committee) in the periodic evaluation and performance review of the Chief Executive Officer and other principal officers; (v) upon request and when appropriate, being available for consultation and communication with shareholders; (vi) communicating Board member feedback to the Chief Executive Officer; (vii) recommending to the Board the retention of advisors and consultants who report directly to the Board; (viii) overseeing the periodic evaluation of the Board and each committee thereof and their respective members; and (ix) performing such other duties as may be delegated by the Board from time to time. Based on his experience, qualifications, and skills more fully described below, the Board appointed Paul R. Lederer to serve as Lead Director.

Committees of the Board of Directors

Executive Committee. From time to time, the Board may delegate to the Executive Committee the authority to supervise and direct certain matters involving the finances and business of the Company between meetings of the Board. Currently, Steven L. Berman and Paul R. Lederer serve on the Executive Committee.

Audit Committee. The Audit Committee, is responsible for reviewing reportsestablished in accordance with Section 3(a)(58)(A) of ourthe Exchange Act, participates in the oversight of (i) the integrity of the Company’s financial results, auditsstatements, (ii) the Company’s compliance with legal and regulatory requirements, (iii) the independent auditor’s qualifications and independence, (iv) the performance of the Company’s independent auditors, and (v) the quality and adequacy of internal controls.controls over financial reporting. The Audit Committee selects our independent registered public accounting firm, reviews such firm’s procedures for ensuring their independence with respect to the services performed for us, approves all fees to be paid to the independent registered public accounting firm and pre-approves the professional services provided by the independent registered public accounting firm. The responsibilities of the Audit Committee are further described in the Audit Committee Charter, which was adopted by the Board and a copy of which is available on the Company’s website atwww.dormanproducts.com and accessible via the “Corporate Governance” page.

As of the date of this proxy statement, Richard T. Riley (Chairman), John F. Creamer, Jr., Paul R. Lederer, and Edgar W. Levin servedand Robert M. Lynch serve on the Audit Committee. Each member of the Audit Committee, in the opinion of the Board, is independent as defined under the applicable SEC rules and the listing standards of NASDAQ. The Board has determined that Mr. Riley qualifies as an audit committee financial expert as defined by the rules of the SEC.

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Compensation Committee. The Compensation Committee is responsible for annually reviewing and approving the compensation of the Board, the compensation of our Chairman and Chief Executive Officer and all of our other executive officers and annually reviewing the compensation systems that are in place for the employees of the Company. The Chief Executive Officer provides the Compensation Committee with his evaluations on the performance of the other executive officers and performance evaluations of certain other key employees, and recommends salary and bonus levels, and equity awards.officers. The Chief Executive Officer is not present during the discussion and approval of his compensation. The Compensation

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Committee also periodically reviews the compensation paid to our non-employee directors for annual retainers and meeting fees and makes recommendations to the Board for any adjustments. The Compensation Committee also administers the Company’s incentive compensation plans and equity-based plans, including the Dorman Products, Inc. 2008 Stock Option and Stock Incentive Plan, referred to as the “2008 Stock Option and Stock Incentive Plan,” the Dorman Products, Inc. 401(k) Retirement Plan and Trust, referred to as the “401(k) Retirement Plan,” and the Dorman Products, Inc. Non-Qualified Deferred Compensation Plan, referred to as the “Non-Qualified Deferred Compensation Plan,” and approves participation in and all awards, grants and related actions under our equity and cash compensation plans for executive officers. The Compensation Committee also administers and approves all awards and certifies payments under the Dorman Products, Inc. Executive Cash Bonus Plan, referred to as the “Executive Cash Bonus Plan.” The responsibilities of the Compensation Committee are further described in the Compensation Committee Charter, which was adopted by the Board and a copy of which is available on the Company’s website at www.dormanproducts.com and accessible via the “Corporate Governance” page.

As of the date of this proxy statement, John F. Creamer, Jr.Edgar W. Levin (Chairman), Paul R. Lederer, Edgar W. Levin (Chairman)Robert M. Lynch and Richard T. Riley servedserve on the Compensation Committee. Each member of the Compensation Committee, in the opinion of the Board, is independent as defined under the applicable SEC rules and the listing standards of NASDAQ.

Corporate Governance and Nominating Committee. The Corporate Governance and Nominating Committee is responsible for evaluating and approving our plans, policies, programs, and principles with respect to corporate governance, especially as they relate to directors’ duties and responsibilities. The Corporate Governance and Nominating Committee evaluates and reports to the Board on the performance and effectiveness of the Board to facilitate the directors fulfilling their responsibilities in a manner that serves the interest of our shareholders.

The Corporate Governance and Nominating Committee is also responsible for recommending qualified candidates to the Board for election as directors of the Company, and has recommended to the Board the slate of directors that the Board proposes for election by shareholders at the annual meeting. The responsibilities of the Corporate Governance and Nominating Committee are further described in the Corporate Governance and Nominating Committee Charter, which was adopted by the Board and a copy of which is available on the Company’s website at www.dormanproducts.com and accessible via the “Corporate Governance” page.

As of the date of this Proxy Statement, John F. Creamer, Jr.,proxy statement, Paul R. Lederer (Chairman), Edgar W. Levin, Robert M. Lynch and Richard T. Riley serve on the Corporate Governance and Nominating Committee. Each member of the Corporate Governance and Nominating Committee, in the opinion of the Board, is independent as defined under the applicable SEC rules and the listing standards of NASDAQ.

Director Nomination Process

Corporate Governance and Nominating Committee. The Corporate Governance and Nominating Committee is responsible for, among other matters, annually presenting to the Board a list of individuals recommended for nomination for election as directors at the annual meeting. The Corporate Governance and Nominating Committee assists the Board in identifying, interviewing and recruiting candidates as necessary for the Board. The Corporate Governance and Nominating Committee also has the authority as it deems appropriate to retain a professional search firm to identify and evaluate director candidates.

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Before recommending a director, the Corporate Governance and Nominating Committee reviews his or her qualifications to determine whether the director candidate meets the qualifications described below. In the case of an incumbent director, the Corporate Governance and Nominating Committee also reviews the director’s service to the Company during the past term, including the number of Board and committee meetings attended, the quality of participation and whether the candidate continues to meet the qualifications for director as described below. After completing this evaluation, the Corporate Governance and Nominating Committee makes a formal recommendation to the full Board as to election or re-election of the candidate.

Director Qualifications. In order to be nominated for director, a director candidate must be a natural person at least eighteen (18) years of age. The Corporate Governance and Nominating Committee has not established specific education or years of business experience requirements for potential director nominees, but in general director qualifications include, among other factors, capability, availability to serve, conflicts of interest and moral character. Further, the Corporate Governance and Nominating Committee believes that the Board, as a whole, should include members who collectively bring the following strengths and backgrounds to the Board:

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Additional criteria appliesapply to directors being considered to serve on a particular committeecommittees of the Board. For example, members of the Audit Committee must meet additional standards of independence and have the ability to read and understand our financial statements.

The Corporate Governance and Nominating Committee uses a variety of methods to identify and evaluate nominees for director. Candidates may come to the attention of the committee through current and former Board members, management, professional search firms (to whom we pay a fee), shareholders or other persons. The Committee evaluates candidates for the Board on the basis of the standards and qualifications set forth above, regardless of the source of the candidate referral. Although the Company does not have a formal policy with regard to consideration of diversity, the Board seeks to achieve a diversity of strengths and backgrounds on the Board, particularly in the areas described above.

Director Candidates Nominated by Shareholders. Under our Amended and Restated By-Laws, a shareholder may nominate a person for election as a director at the next annual meeting of shareholders if the shareholder making the nomination:

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For a shareholder nomination notice to be timely under our Amended and Restated By-laws, it must be delivered to, or mailed and received by, the Secretary of the Company at our principal executive offices not earlier than the close of business on the one hundred twentieth (120th) calendar day, and not later than the close of business on the ninetieth (90th) calendar day, prior to the first anniversary of the immediately preceding year’s annual meeting. If an annual meeting was not held in the prior year or the annual meeting is called for a date that is more than thirty (30) calendar days earlier or more than sixty (60) calendar days later than the anniversary date of the prior year’s annual meeting, to be timely, the shareholder nomination notice must be delivered to or received by, the Secretary of our company at our principal executive officers,offices, no earlier than the close of business on the one hundred twentieth (120th) calendar day prior to the date of the scheduled annual meeting and not later than the close of business on the later of the ninetieth (90th) calendar day prior to the date of the scheduled annual meeting or, if the first public disclosure of the date of the scheduled annual meeting is less than one hundred (100) calendar days prior to the date of the scheduled annual meeting, the tenth (10th) calendar day following the day on which public disclosure of the date of the scheduled annual meeting is first made by us. In no event will any adjournment or postponement of an annual meeting or the public disclosure of any adjournment or postponement of an annual meeting commence a new time period or extend any time period for the giving of a shareholder nomination notice.

The following information must be included in the shareholder nomination notice:

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A “Shareholder Associated Person” means with respect to any shareholder (i) any person controlling, directly or indirectly, or acting in concert with, the shareholder, (ii) any beneficial owner of our securities owned of record or beneficially by the shareholder, and (iii) any person controlling, controlled by or under common control with the Shareholder Associated Person. A “Derivative Instrument” means any option, warrant, convertible security, stock appreciation right, or similar right with an exercise or conversion privilege or a settlement payment or mechanism at a price related to any class or series of our securities or with a value derived in whole or in part from the value of any class or series of our shares, whether or not such instrument or right shall be subject to settlement in the underlying class or series of our capital stock or otherwise. A “Short Interest” means any contract, arrangement, understanding, relationship or otherwise pursuant to which the shareholder or any Shareholder Associated Person has the opportunity, directly or indirectly, to profit or share in any profit derived from any decrease in the value of any security issued by us.

In addition to the information required above, we may require any proposed nominee to furnish such other information as may reasonably be required by us to determine the eligibility of the proposed nominee to serve as an independent director or that could be material to a reasonable shareholder’s understanding of the independence, or lack thereof, of such nominee.

Under our Amended and Restated By-Laws, a shareholder is entitled to nominate a person for director at a special meeting of shareholders at which directors are to be elected if the shareholder meets the requirements set forth above and complies with the shareholder nomination notice procedures set forth above. With respect to a special meeting, the shareholder’s nomination notice must be delivered to the Secretary of our companythe Company at our principal executive offices not earlier than the close of business on the one hundred twentieth (120th) calendar day

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prior to the date of the special meeting and not later than the close of business on the later of the ninetieth (90th) calendar day prior to the date of the special meeting or, if the first public disclosure made by us of the date of the special meeting is less than one hundred (100) days prior to the date of the special meeting, not later than the tenth (10th) calendar day following the day on which public disclosure is first made of the date of the special meeting and of the nominees proposed by the Board to be elected at the special meeting. In no event shall any adjournment or postponement of a special meeting or the public disclosure of an adjournment or postponement of a special meeting commence a new time period or extend any time period for the giving of a shareholder’s nomination notice.

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Meetings of the Board of Directors and Committees

During the fiscal year ended December 31, 2011,27, 2014, the Board held five meetings. The Executive Committee did not hold any meetings, the Audit Committee held four meetings, the Compensation Committee held one meeting,two meetings, and the Corporate Governance and Nominating Committee held one meeting in 2011. Eachfiscal 2014. During fiscal 2014, each incumbent director attended at least 75% of the aggregate of (1) the total number of meetings of the Boarddirectors which were held during the period for which the director was a director, and (2) the total number of meetings held by any committees of which they werethe director was a member during fiscal year 2011.the period that the director served.

Attendance at Annual Meeting of Shareholders

It is the policy of the Board that, absent sufficient cause, all of our directors attend our annual meeting. All of our then directors attended last year’s Annual Meeting of Shareholders.annual meeting.

Communication with the Board of Directors

Shareholders may communicate with the Board or any individual director by sending a letter addressed to the Board or the individual director c/o Thomas J. Knoblauch, Assistant Secretary, Dorman Products, Inc. at 3400 East Walnut Street, Colmar, Pennsylvania 18915. In the letter, the shareholder must identify him or herself as a shareholder of the Company. The Assistant Secretary may require reasonable evidence that the communication is being made by or on behalf of a shareholder before the communication is transmitted to the individual director or to the Board.

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Proposal I – Election of Directors

Our Amended and Restated By-Laws provide that our business shall be managed by or under the direction of a board of directors of not less than two nor more than seven directors, which number shall be fixed from time to time by such board of directors. AsThe Board currently consists of six directors. Five of the datesix members of the annual meeting,Board are standing for re-election. Pursuant to our Amended and Restated By-Laws, the Board has fixed the number of directors at five.five, as of the date of the annual meeting.

There are five nominees for election to the Board at the annual meeting. Each of the five directors shall benominees, if elected, at the annual meetingwill hold office for a term that expires at the next annual shareholder’s meeting. Each director shall hold office for the term for which he was elected and until his successor is elected and qualified or until his earlier death, resignation or removal. Proxies solicited by the Board will, unless otherwise directed, be voted to elect the five nominees named below to constitute the entire Board.

OurThe Board has nominated the following individuals for election as director at the annual meeting: Steven L. Berman; Mathias J. Barton; Paul R. Lederer; Edgar W. Levin and Richard T. Riley. The board did not nominate Robert M. Lynch for re-election and his term will expire at the conclusion of the annual meeting. Each nomination for director was based upon the recommendation of our Corporate Governance and Nominating Committee and each nominee for director is responsible for recommending qualified candidates to the Board that the Board proposes for election by the shareholders. All of the nominees area current directors of the Company and are nominated by the independent membersmember of the Board. All nominees were recommendedhave consented to the Board by the Corporate Governancebe named and Nominating Committee.have indicated their intent to serve if elected. In the event any of the nominees shall be unable or unwilling to serve as a director, the persons named onin the proxy intend to vote “FOR” the election of any person as may be nominated by the Board in substitution. The Company has no reason to believe that any of the nominees named below will be unable to serve as a director if elected.

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The following table sets forth certain information, as of the record date, as to each nominee for the office of director:

The following information about our directors is based, in part, upon information supplied by such persons. Unless otherwise indicated, each individual has had the same principal occupation for more than five years.

Steven L. Berman became the Chairman of the Board and Chief Executive Officer of the Company on January 30, 2011. Additionally, Mr. Berman has served as a director of the Company since its inception in 1978 and as Secretary-TreasurerSecretary and Treasurer of the Company since October 24, 2007. From October 24, 2007 to January 30, 2011, Mr. Berman served as President, Secretary and Secretary-TreasurerTreasurer of the Company. Prior to October 24, 2007, Mr. Berman served as Executive Vice President, Secretary and Secretary-TreasurerTreasurer of the Company. Pursuant to the terms of our employment agreement with Mr. Berman and subject to certain exceptions described therein, if the Corporate Governance and Nominating Committee fails to nominate or re-nominate Mr. Berman as a director, or if the Board removes Mr. Berman as a director, Mr. Berman may terminate his employment within 120 days and receive certain benefits prescribed by the employment agreement. See “Executive Compensation—Potential Payments upon Termination or Change in Control—Employment Agreement with Steven L. Berman—Employment Agreement Benefits” for a discussion of the benefits payable to Mr. Berman upon a termination of employment following the decision of the Corporate Governance and Nominating Committee not to nominate or re-nominate Mr. Berman as a director, or of the Board to remove Mr. Berman as a director.

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Key Attributes, Experience and Skills:Mr. Berman has more than thirty years of experience in the automotive aftermarket industry and has been involved with the Company since its formation, including over 30 years in management of the Company. He has the requisite skills to serve in his executive capacities including particular skills and knowledge in marketing, finance, product development, vendor relations and strategic business management. Mr. Berman has the ability to connect industry trends, market events, strengths and weaknesses of competitors, the impact of new market entrants and the ability to define a strategic path. In addition, he has demonstrated the ability to convert a high-level strategy into an executable game plan. As a result of his positions with the Company, he also has intimate knowledge of ourthe Company’s business, results of operations and financial condition which enables him to provide unique insights into the Company’s challenges, opportunities, risks and operations.

John F. Creamer, Jr.Mathias J. Barton has served as a director since 1995. Since 1978,January 2014. Mr. Creamer has servedBarton joined the Company in November 1999 as Senior Vice President, Chief Financial Officer. He became co-President of the Company in February 2011 and President in August 2013. Prior to joining the Company, Mr. Barton was Senior Vice President and Chief Financial Officer of Distribution Marketing Services,Central Sprinkler Corporation, a manufacturer and distributor of automatic fire sprinklers, valves and component parts. From May 1989 to September 1998, Mr. Barton was employed by Rapidforms, Inc., a marketing consulting firm for the automotive aftermarket located in Phoenix, Arizona. Mr. Creamer is a former directormanufacturer of business forms and former vice chairman of the Board of Directors of Echlin Corporation, an automotive parts company,other products, most recently as Executive Vice President and former president of the Automotive Warehouse Distributors Association (AWDA).Chief Financial Officer.

Key Attributes, Experience and Skills:Mr. Creamer’s contributionBarton is qualified to serve as a director of the Company based on his extensive knowledge of the Company’s Board comes from his 50 years of industry-related business experience with over 30 years in marketing consulting specifically in the automotive aftermarket, as well as his prior board experience with companies in the industry and service in management positions in industry groups. Mr. Creamer is well known and highly regarded in the automotive aftermarket industry, having received a varietyhis expertise in strategic business development and executive management, his knowledge of industry awards duringcorporate finance, financial systems and reporting, accounting, and his 50 year career. His executive-level sales experience has made him an expert at analyzing productintegrity, energy, and marketing programs and their impact on long-term shareholder value.leadership skills.

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Paul R. Lederer has served as a director since 1998. Prior to his retirement in 1998, Mr. Lederer was the Executive Vice President of Federal-Mogul Corporation, a global manufacturer of a broad range of non-discretionary parts primarily for automobiles, light trucks, heavy trucks, and farm and construction vehicles, from February 1998 to October 1998. From November 1994 to February 1998, Mr. Lederer was President and Chief Operating Officer of Fel-Pro Incorporated, a private manufacturer of gaskets and related products for the internal combustion engine, which was acquired by Federal-Mogul in 1998. Before joining Fel-Pro, he was a consultant to several automotive parts companies. Mr. Lederer is currently a director of O’Reilly Automotive, an automotive parts distributor and retailer. Mr. Lederer has served two stintsterms as a director of O’Reilly Automotive, from April 1993 to July 1997 and was appointed again in 2001. He currently serves as O’Reilly’s lead director, a position he has held since 2002. Mr. Lederer is also a director of Maximus, Inc., a provider of program management and consultative services to state and local governments. He was a director of Proliance International, Inc. from 1995 to 2009 and a director of United Components, Inc. from 2003 to 2010.

Key Attributes, Experience and Skills:Mr. Lederer’s 20 plus years of executive experience in the automotive aftermarket industry makes him uniquely qualified to assess the Company’s strategies, goals, and objectives on behalf of its shareholders. He has a high degree of business acumen which enables him to synthesize and connect broad market trends, industry trends, and evolving customer needs.

Edgar W. Levin has served as a director since 1991. Mr. Levin has been President of Ed Levin Associates, a management consulting firm, located in Boynton Beach, FL,Florida, since 1989. Prior thereto, he was Senior Vice President of Paramount Communications, Inc., a media and entertainment company and its predecessor, Gulf & Western Industries, a large conglomerate and major manufacturer of and distributor of automotive aftermarket parts. Mr. Levin was a member of the Office of the Chairman at Paramount Communications.

Key Attributes, Experience and Skills:Mr. Levin is skilled at financial statement analysis and interpreting financial measures of performance. He is well skilled in finance, operations, mergers and acquisitions, and strategic planning. He has a thorough understanding of the market that we serve, our customers, operations, and our financial requirements.

Richard T. Riley was appointed to the Board inhas served as a director since March 2010. Mr. Riley has served as a director of the LoJack Corporation, a publicly traded corporation and provider of tracking and recovery systems, from February 2005 until May 2013. In May 2012, Mr. Riley retired from the position of Executive Chairman of the Board of Lojack Corporation sinceLoJack, a role held from December 2011. From2011 to May 2012. He previously served LoJack as Chairman, President, and Chief Executive Officer from May 2010 to December 2011, he served as Lojack’s Chairman, President, and Chief Executive Officer. He previously served as the Executive Chairman of Lojack from December 2008 untilto May 2010, the Chairman and Chief

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Executive Officer from November 2006 untilto December 2008 and as its President and Chief Operating Officer from February 2005 untilto November 2006. Mr. Riley has served as a director of the LoJack Corporation since February 2005. Mr. Riley has indicated that he will retire from his position as LoJack’s Executive Chairman in May 2012. Prior to joining LoJack Corporation, Mr. Riley served as an officer and director of New England Business Service, Inc., referred to as “NEBS,” then a public company listed on the New York Stock Exchange.Exchange and a provider of products and services to assist small businesses manage and improve the efficiency of business operations. He served as President and Chief Operating Officer of NEBS from 2002 to 2003 and as President, Chief Executive Officer and Chief Operating Officer from 2003 to 2004. Prior to that, Mr. Riley served as a Senior Vice President of NEBS from 1998 to 2002, as President, NEBS Direct Marketing from 2001 to 2002, as President, Integrated Marketing Services from 2000 to 2001 and as President of Rapidforms, Inc. (acquired by NEBS in 1997) from1992 to 2000. Mr. Riley served as a director of NEBS from 2002 to 2004. Mr. Riley was formerly a member of the audit practice at Arthur Andersen & Co. Mr. Riley serves as a member of the Board of Directors of VistaPrintCimpress N.V. (f/k/a VistaPrint), a publicly held printing and graphic arts business, where he is Chairman of the Board and serves on both the Audit Committee and the Nominating and Corporate Governance Committee. He is also a member of the Board of Directors of Micro-Coax, Inc., a privately held manufacturer of microwave and cable products.

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Key Attributes, Experience and Skills:Mr. Riley is an experienced leader in the automotive industry with a distinctive knowledge of the automotive products aftermarket. He draws his financial expertise from his experience as Audit Manager at Arthur Andersen & Co, his service as a Chief Financial Officeran executive at Rapidforms,each of LoJack and NEBS, and his service on the Audit Committee at VistaPrintCommittees of Cimpress N.V. (f/k/a VistaPrint) and Micro-Coax. He is skilled in finance, operations, corporate governance, mergers and acquisitions and strategic planning. Mr. Riley’s financial background as a certified public accountant, including his experience at Arthur Andersen & Co. and Chief Financial Officer of Rapidforms,, provides financial expertise to the Board, including an understanding of financial statements, corporate finance, accounting and capital markets.

The Board Recommends a Vote “FOR”

the Election of the Five Nominees listed above as Directors.

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Director Compensation in Fiscal 2014

The following table sets forth certain information regarding the annual and long-term compensation earned by or awarded to each non-employee director who served on our Board during the fiscal year ended December 31, 2011.27, 2014. Directors who are our employees are not compensated for their services as directors.

EachIn fiscal 2013, the Compensation Committee engaged Pay Governance, LLC, a compensation consultant, to review the fiscal 2014 compensation program for the directors of the Company. For 2014, the Compensation Committee recommended, and the Board approved, the following changes to our director compensation program:

Accordingly, during fiscal 2014, each of our non-employee directors receivesreceived an annual retainer of $37,500$38,000 plus $1,500$2,000 for each Board meeting attended and $1,000 for each committee meeting attended, including telephone and in-person meetings. The Chairman of the Audit Committee, receives an additional $1,350 for each Audit Committee meeting attended. Thethe Chairman of the Compensation Committee, and the Chairman of the Corporate Governance and Nominating Committee receiveseach received an additional $500annual retainer of $7,500. In addition, each of our non-employee directors received a grant of restricted stock with a grant date value of approximately $60,000 which will vest in full on the one year anniversary of the grant date.

Our non-employee directors are subject to stock ownership guidelines which were adopted by our Compensation Committee effective as of January 1, 2015. Under the approved guidelines, our non-employee directors are each expected to own shares of our common stock with a value at least equal to three times the annual board retainer that we pay such director for each committee meeting attended. Directors are eligible for participation in our equity incentive plans.regular service on the board. Each non-employee director is required to comply with these guidelines within five years following the later of (i) his or her date of first election to the board, or (ii) January 1, 2015.

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Executive Compensation

Compensation Discussion and Analysis

The following discussion provides an analysis of our compensation program for the executive officers named in the Summary Compensation Table below and discusses the material factors involved in our decisions regarding the compensation of the following named executive officers:

The following discussion cross-references those specific tabular and narrative disclosures that appear following this subsection where appropriate. You should read this Compensation Discussion and Analysis in conjunction with such tabular and narrative disclosures.

2011Fiscal 2014 Performance Summary

We are committed to pay for performance. Our executive compensation program is designed to support our business goals and promote profitable growth of the companyCompany and growth in shareholder value. Total compensation for each named executive officer varies with individual performance and the Company’s performance in achieving financial and non-financial objectives.

Over the past several years, we invested significantly in our business, including investments in our people. In 2011, we benefited from those investments, achieving more than $500 million in revenue for the first time and reporting the most profitable year in the Company’s history. Revenue increased 16% in 2011 compared to 2010, our net income increased by 16% from 2010, and diluted earnings per share increased by 15% from 2010.

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Our favorable financial and operational results are reflected in our executive compensation for 2011.fiscal 2014. Our executive compensation advances our goals of recruitment and retention, and promotes both short-term and long-term performance of our executive officers. As seen in the chart below, in fiscal 2014, we again delivered growth in net income and diluted earnings per share.

Executive Compensation Philosophy and Objectives

Our executive compensation program is designed to promote the successful implementation of our annual strategic plan as approved by the Board as well as long-term growth and profitability of the Company which is intended to enhance shareholder value. Our overall executive compensation program is designed to achieve the following objectives:

We believe that our program focuses management’s attention on achieving both annual performance targets and profitable growth over a longer time period as established by the Board.

We believe it is important that our executive compensation program be competitive and attractive when compared to the compensation programs of peers within our industry with which we compete for executive talent. We must be able to attract and retain skillful and knowledgeable management to manage the Company and poise the Company for future growth while at the same time being mindful of our responsibility to shareholders to control costs. Our compensation philosophy reflects a commitment to compensate executives competitively with other companies in the industry while rewarding specific executives for achieving levels of operational excellence and financial returns that ensure positive short and long-term business performance and continual growth in shareholder value.

We believe that total amounts of compensation should generally reflect an executive’s experience, skill, knowledge, responsibility and performance within ourindividual contributions to the overall success of the Company. Amounts should typically increase with increases in an executive’s functional role and his or her ability to affect our performance results. As position and responsibility increase within the Company, a greater portion of the executive’s total compensation becomes performance basedperformance-based pay contingent upon the achievement of performance objectives established by the Compensation Committee.

We believe that equity compensation is an excellent way to encourage our executive officers to act in the best interests of our shareholders and to create an environment of shared risk between our named executive officers and our shareholders. From time to time, we have provided our executive officers with long-term incentives in the form of incentive or non-qualified stock options and grants of restricted stock. Historically, we have also provided our named executive officers with equity awards in connection with our new hire process and for promotions.

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We enter into employment agreements Starting in fiscal 2014 and have put into place severance arrangementsgoing forward, the Compensation Committee also intends to retain qualifiedprovide our named executive officers. officers with performance-based equity awards.

We have entered into an employment agreement with our Chief Executive Officer to retain his services and provide him with compensation that reflects his overall experience, position and responsibilities, and expected contributions. Since we do not have employment agreements with our other named executive officers, we have agreed to severance arrangements with certain of such executives to encourage them to remain in our employ and permit such individuals to remain focused on the Company’s strategic business objectives during the course of their employment by providing some relief from concerns related to job security.

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Determining Executive Compensation

As outlined in the Compensation Committee Charter, the Compensation Committee is responsible for annually reviewing and approving executive compensation. The Compensation Committee annually reviews and approves the compensation of our Chief Executive Officer (except as provided in(subject to the terms of his employment agreement) and the compensation of our other named executive officers. The Compensation Committee works together with management to establish strategic plans and business performance targets and objectives against which management will be measured for each fiscal year. Performance objectives for our named executive officers were based on growth in income before income taxes (pre-bonus) subject to adjustment for one time or unusual items for fiscal year 2011 and the three-year period ended December 31, 2011. Following completion of this process, the Compensation Committee reviews and approves the corporate goals and objectives used to compensate the Chief Executive Officer and evaluates his performance in light of those goals and objectives. With respect to the other named executive officers’ compensation, the Chief Executive Officer provides the Compensation Committee with his evaluation of the performance of each of the other named executive officers, and performance evaluations for certain other key employees, and recommends increases in salary as well as bonus levels, and the amount of equity awards (if any) for consideration by the Compensation Committee.

The Compensation Committee annually reviewsdetermined fiscal 2014 compensation of our named executive officers without the input of any compensation systems that are in placeconsultants. Compensation decisions for individual named executive officers were the employeesresult of the subjective analysis of a number of factors, including the executive officer’s performance, long-term potential, responsibilities, experience, skills, tenure with the Company and historical compensation amounts. In making individual compensation decisions, the Compensation Committee relied on the judgment and experience of its members as well as information that was reasonably available to committee members, including, but not limited to, comparable company data. In addition to these factors, the Compensation Committee also considered internal comparisons of pay within the executive group.

For 2014, the Compensation Committee approved the following changes to our executive compensation program:

The Compensation Committee approves participation in, and all awards, grants and related actions under, our equity plans.plans for our Chief Executive Officer and our other executive officers. The Compensation Committee also approves profit sharing that is contributed to the 401(k) Retirement Plan, and administers the Dorman Products, Inc. Non-Qualified Deferred Compensation Plan, andreferred to as the “Non-Qualified Deferred Compensation Plan,” the Dorman Products, Inc. Executive Cash Bonus Plan, referred to as the “Executive Cash Bonus Plan,” and will certify payments to participants under the planExecutive Cash Bonus Plan and the 2008 Stock Option and Stock Incentive Plan in accordance with Section 162(m) of the Internal Revenue Code of 1986, as amended, referred to as the “Code.” In addition, the Compensation Committee annuallyalso reviews and approves and, where appropriate, recommends to the Board for its approval, any executive employment agreements, severance arrangements, change in control arrangements, and any special or supplemental benefits for the Chief Executive Officer and other executive officers, in each case as, when, and if appropriate.

Role of Our Compensation Consultant

The Compensation Committee has the authority under its charter to retain compensation consultants toconsultants. To assist it in determining compensation. In setting executive compensation,carrying out its responsibilities, the Compensation Committee has not electedfrom time to utilizetime retained consultants to provide independent advice on executive compensation and to perform specific tasks as requested by the servicesCompensation Committee. The consultants reported directly to the Compensation Committee. The Compensation Committee reviews and assesses the independence and performance of any consultant then engaged on an annual basis in order to confirm that the consultant is independent and meets all applicable regulatory requirements.

The Compensation Committee engaged Pay Governance LLC, an independent compensation consultant, but electsin December 2012 to conductperform a market-based analysis of our executive compensation and to provide advice regarding compensation practices for our executives. Pay Governance did not provide any services to us for fiscal 2014 executive compensation. However, the fiscal 2012 recommendations of Pay Governance are reflected in the Company’s fiscal 2014 executive compensation program.

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In conducting its own informalanalysis in fiscal 2012, Pay Governance:

Pay Governance LLC does not provide any services to the Company other than advice for the Compensation Committee regarding executive and director compensation. The Compensation Committee has assessed the independence of Pay Governance LLC pursuant to SEC rules and concluded that no conflict of interest exists.

Competitive Market Pay Information

In December 2012, the Compensation Committee, with the assistance of Pay Governance, conducted a comprehensive review of our executive compensation to ensure that we were paying our executive officers competitive levels of compensation that best reflected their individual responsibilities and contributions to our operations and provided incentives to achieve our business objectives. This comprehensive review was intended to assist the Compensation Committee in setting executive compensation for fiscal 2013 and future years.

In order to assess our executive compensation, in December 2012, the Compensation Committee, with the assistance of Pay Governance, reviewed competitive compensation data from Watson Wyatt’s 2011 General Industry Top Management Compensation Survey. The Watson Wyatt Survey contained data from over 636 companies from a wide variety of industries and included a sample of firms comparable to the Company in terms of revenue and industry.

In addition, in December 2012, the Compensation Committee, with the assistance of Pay Governance, conducted a formal review of the compensation of our executive officers as compared to the base salary, total cash compensation, and other compensation of executives at a group ofthe peer companies including LKQ Corporation, LoJack Corporation, Motorcarin the table below:

The peer companies were selected at the recommendation of America, Inc., Standard Motor Products, Inc.,Pay Governance, after determining that the revenues, market capitalization, and/or industry of each company were comparable to that of the Company.

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The Compensation Committee believes that the Watson Wyatt Survey and Tenneco Inc., referredthe compensation data related to as the “Peer Companies.” From timecompanies in our peer companies constituted appropriate guidelines for it to time,compare proposed pay levels for our named executive officers with those of other companies. The purpose of using this data was to assist the Compensation Committee also acquiresin assessing whether our proposed executive compensation studieswas competitive. The Compensation Committee considered these data only as a guidepost to their evaluation of senior managementproposed compensation at companiesamounts, and there was no mandate that are similarany actual compensation paid must fall within any set range. Our Compensation Committee and the Board believe that using the market comparative data in size to our company but operatethis manner was useful in different industries. Our most recentestablishing an appropriate and competitive compensation study, acquired for fiscal 2011, included compensation on both the Peer Companies and on companies that are similar in size but operate in different industries.

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Say on PaySay-on-Pay

At the 2011May 2014 annual meeting, we held a shareholder advisory vote on the compensation of our named executive officers, commonly referred to as a say-on-pay vote. Our shareholders approved the compensation of our named executive officers at the 2011May 2014 annual meeting, with an overwhelming majority of shareholder votes cast in favor of our say-on-pay resolution. As we evaluated our compensation practices and talent needs, throughout 2011, we were mindful of the strong support our shareholders expressed for our pay for performance compensation philosophy. As a result, following our annual review of our executive compensation philosophy, the Compensation Committee decided to retain our general approach to executive compensation. Our executive compensation for 2011fiscal 2014 reflects our favorable financial and operational performance and advances our goals of recruitment and retention, and promotes both short-term and long-term performance of our executive officers.

The Components of the Executive Compensation Program

Elements of compensation for our executives includeincluded the following components:

In setting compensation levels, we consider, among other things, the financial performance of the Company; the executive’s individual job performance; the responsibilities, experience and long-term potential of the executive; historical compensation amounts; competitive pay practices generally; relative compensation levels among our senior management team; and general economic conditions.

Base Salary. Base salary reflects amounts paid during the year to our executive officers as direct compensation for their services to the Company as well as to reward eachour executive officerofficers for their individual performance and to encourage them to higher levels of performance. We also use our base salary to attract and retain top quality executives and other managers from other companies. Base salaries and increases to base salaries recognize the overall experience, position, responsibility and expected contributions of theeach executive. The base salaries for each of our named executive officers are set forth in the Summary Compensation Table below.

The Compensation Committee establishes and approves annual base salaries for all of the executive officers of the Company, other than those set by agreement, taking into consideration, among other things, the recommendations of the Chief Executive Officer. The base salary of our Chief Executive Officer is set pursuant to his employment agreement and may be increased, but not decreased, over the term of the agreement in the discretion of the Compensation Committee. Base salaries of the other named executive officers, as well as annual salary adjustments for Mr. Berman, are set annually at levels that we determine adequately reward and retain capable executives, including without targeting any specific quartile of any compensation survey data for total compensation

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or any component of total compensation. In establishing base salary of our executive officers, as well as annual adjustment for Mr. Berman, we considered individual performance, the importance of, and skills required in, his positions,the executive officer’s position, and his total amount of experience.

We intend that overall compensation, including base salary and bonus, to reflect the performance of each individual executive over time, as well as their contribution to the Company’s annual results and long term initiatives. In December 2010,2013, the Compensation Committee determined to modestly increaseincreased the base salaries of our named executive officers for 20112014 by three percent (3.0%), except3.0%. For fiscal 2014 (effective December 28, 2013) our Compensation Committee authorized the following base salaries for Mr. Kohnke who became our Chief Financial Officer in February 2011.

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Performance Based CashPerformance-Based Bonuses. We use performance based cashperformance-based bonuses to reward eligible employees at the manager level and above, including our named executive officers, for our financial performanceperformance. The performance-based bonus program provides for bonuses which are differentiated between executive levels within the executive group, and to a lesser extent their individual performance duringreward our executives for the year. The bonuses are intended to reward the recipients for their short-term contributions to the Company and to connect compensation tosuccessful achievement of our annual and long-term financial performance objectives. The Compensation Committee believes that awards under the Executive Cash Bonus Plan assist the Company in motivating and retaining executive talent whose abilities and leadership skills are critical to the Company’s long-term success.

In December 2009, our Board unanimously approved the Executive Cash Bonus Plan, which provides for incentive payments to executives who may be impacted by Section 162(m) of the Code. Our Executive Cash Bonus Plan, including the business criteria upon which performance measures are based, was approved by our shareholders on May 20, 2010. In addition, on May 16, 2014, our shareholders approved updated material terms of the performance goals under the Executive Cash Bonus Plan which will be applicable to future awards.

Our Executive Cash Bonus Plan is designed to provide a direct link between performance and compensation for our top executives. Additionally, the plan is intended to qualify certain components of compensation paid to these executives for tax deductibility under Section 162(m) of the Code. The Executive Cash Bonus Plan replaced our existing executive bonus plan for executives beginning with fiscal year 2010 and automatically renews upon the beginning of each fiscal year unless terminated by the Compensation Committee. Under the terms of his employment agreement, Steven L.Mr. Berman, our Chairman of the Board, Chief Executive Officer, Secretary and Secretary-Treasurer,Treasurer, is automatically eligible to participate in the Executive Cash Bonus Plan. For fiscal 20112014, each of Messrs. Berman, Barton, Darby, Kealey and fiscal 2012, the Compensation Committee designated as participantsKohnke participated in our Executive Cash Bonus Plan. The maximum aggregate bonus amount that may be paid in any single year to any participant under the Executive Cash Bonus Plan those named executive officers whose compensation may be subject to Section 162(m).is $2,000,000.

Section 162(m) generally disallows a federal income tax deduction to any publicly held corporation for non-performance-based compensation paid in excess of $1,000,000 in any taxable year to the Chief Executive Officer or certain other highly compensated executive officers. We intendThe Compensation Committee intends to structure awards under the Executive Cash Bonus Plan so that compensation under the plan will be qualifiedcan qualify as “performance-based compensation” eligible for continued deductibility.

Our named executive officers (except Mr. Kohnke) were eligible to participate inThe awards for fiscal 2014 under the Executive Cash Bonus Plan for fiscal year 2011. The plan had two components: (i) an annual performance bonus,performance-based cash award based on our fiscal 2014 growth in adjusted pre-tax income, referred to as the “annual cash bonus;” and (ii) a three-year compounded growth performance bonus. The annual performance bonus and the three-year compounded growth performance bonus are eachlong-term performance-based award based on our compounded three-year growth in adjusted pre-tax income, referred to as the “long-term bonus.” For purposes of this bonus plan, “adjusted pre-tax

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income” means the Company’s growth inconsolidated pre-tax income before executive bonus expense and before “unusual items.” “Unusual items” include all non-recurring items generally excluded from earnings per share and EBITDA and by institutional investors or analysts when evaluating the Company’s performance, such as one-time gains from asset sales, litigation charges or recoveries, impairment charges, and restructuring charges, but including normal provisions for slow moving and obsolete inventory and accounts receivable. As it relates to adjustments for unusual items, (i) fiscal 2014 pre-tax income taxes (pre-bonus) subjectwas adjusted for a $1.0 million reduction in earn-out payable in connection with our May 2013 acquisition of Re-Involt Technologies, Inc., (ii) there was no adjustment to adjustmentfiscal 2013 pre-tax income for one timeone-time or unusual items, as described inand (iii) fiscal 2011 pre-tax income was adjusted for $2.9 million of asset write-downs and employee-related reserves resulting from our Executive Cash Bonus Plan.decision to exit the international portion of our Scan Tech business. The Compensation Committee believes that basing performance on adjusted pre-tax income focuses management’s attention on revenue growth, profitability and increasing market share which are key drivers in building shareholder value.

The eligibleFor fiscal 2014, with respect to the annual performancecash bonus, the amount for our Chief Executive Officerof bonus paid to each named executive officer was computed by multiplying the named executive officer’s annual base salary for fiscal year 2011 was set2014 by the Compensation Committee at $520,000. The eligibleAnnual Bonus Percentage. For purposes of the annual performancecash bonus, amount for each of our other named executive officers participating in fiscal year 2011the Annual Bonus Percentage was set by the Compensation Committee at $280,000. The annual performance bonus amount actually awarded is equal to the annual cash bonus factor for each executive level set forth in the table below multiplied by the percentage growth in adjusted pre-tax income for fiscal 2014 compared to fiscal 2013.

For fiscal 2014, with respect to the long-term bonus, the amount of bonus paid to each named executive officer was computed by multiplying the named executive officer’s eligible annual base salary for fiscal 2014 by the Three Year Bonus Percentage. For purposes of the long-term bonus, amountthe Three Year Bonus Percentage was equal to the applicable long-term bonus factor for each executive level set forth in the table below multiplied by two times the percentage annual growth in our adjusted pre-tax income.

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The three-year compounded growth performance bonus component is based on the Company’s growth in income before income taxes (pre-bonus) adjusted for one time or unusual items over the past three years. For fiscal year 2011, the Compensation Committee determined that the participating officers will each receive a bonus payment of $50,000 if our compounded three-year growth in income before income taxes (pre-bonus) adjusted for one time or unusual items is between 5.0% and 10.0%, a payment of $100,000 if ourpre-tax income. The compounded three-year growth in adjusted pre-tax income beforewas computed by comparing the adjusted pre-tax income taxes (pre-bonus) adjusted for one time or unusual items is between 10.0% and 15.0% and a payment of $150,000 if our compounded three-year growth in income before income taxes (pre-bonus) adjusted for one time or unusual items is greater than 15%. No compounded growth performance bonus will be paid if our compounded three-year growth in income before income taxes (pre-bonus) adjusted for one time or unusual items is below 5.0%.

Fifty percent of a named executive officer’s earned bonus pursuantfiscal 2014 to the adjusted pre-tax income for fiscal 2011.

The long-term bonus was payable in cash or equity (pursuant to the 2008 Stock Option and Stock Incentive Plan) at the discretion of the Compensation Committee.

The Compensation Committee has the right to reduce (but not increase) awards issued under the Executive Cash Bonus Plan in its discretion, even if the performance measures have been attained. For fiscal 2014, the Compensation Committee awarded annual performance bonus componentcash bonuses of $244,692, $131,270, $50,660, $50,660 and $36,099 to each of Messrs. Berman, Barton, Darby, Kealey, and Kohnke, respectively. For fiscal 2014, the three-year compounded growth performance component will beCompensation Committee awarded long-term bonuses of $517,248, $277,489, $80,317, $80,317and $57,232 to each of Messrs. Berman, Barton, Darby, Kealey and Kohnke, respectively. Such annual cash bonuses and long-term bonuses for fiscal 2014 were paid in cash in the first quarter of the year following the year in which the bonus was earned; the remaining 50% is paid in four equal quarterly installments 180, 270, 360 and 450 days after the fiscal year end in which the bonus was earned. Unless otherwise approved by the Compensation Committee, the executive officer must be employed full-time on the scheduled date of payment to receive that portion of the bonus.

For fiscal year 2011, the Compensation Committee awarded bonuses of $288,506, $224,580, $224,580 and $224,580 to each of Messrs. Steven L. Berman, Mathias Barton, Joseph Beretta and Fred Frigo, respectively, pursuant to the terms of the Executive Cash Bonus Plan, including the payment terms and the events of forfeiture thereunder.2015. The bonus awards resulted from our positive growth in fiscal 20112014 adjusted pre-tax income of 8% and our 46.5%a three-year compounded three-year growth in adjusted pre-tax income before income taxes (pre-bonus) as adjusted for one time or unusual items. The Compensation Committee has determined that only the 50% of the 2011 performance bonus to be paid to each of Messrs. Steven L. Berman, Mathias Barton, Joseph Beretta and Fred Frigo in four equal installments on the 180th, 270th, 360th and 450th day after the fiscal year end shall be subject to forfeiture.16.8%.

Discretionary Cash Bonuses.In addition to the performance based cashperformance-based bonuses described above, the Compensation Committee has the authority to award discretionary cash bonuses. This type of bonus ishas been used to reward executive officers and other employees for exemplary performance during the year and to attract and recruit qualified candidates. In 2011, the Compensation Committee awarded discretionary bonuses to Steven L. Berman, who served as Chairman of the Board, Chief Executive Officer and Secretary-Treasurer, during fiscal year 2011, Mathias J. Barton, who served as co-President in fiscal year 2011, and Joseph Beretta, who served as co-President in fiscal year 2011, in the amounts of $250,000, $100,000 and $100,000, respectively. No other named executive officers received discretionary bonuses in 2011. The Compensation Committee consideredconsiders the following factors in determining the amount of discretionary bonus payable to thesean executive officers for fiscal 2011:officer, if any: the Company’s overall performance in light of economic conditions experienced during the fiscal year, the executive’s contribution to the Company’s annual and long-term

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strategic objectives, including maximizing shareholder value, the quality of the executive’s work, and the general success of the Company, as well as the officer’s contribution to specific strategic initiatives as may be measured in ways different from the performance criteria identified above. Amounts earned as discretionary cash bonuses by the Named Executive Officers are included in the Summary Compensation Table under the column heading “Bonus.” Discretionary bonus amounts, if any, are paid in the first quarter of the year following the year in which the bonus was earned. There were no discretionary cash bonuses paid to our named executive officers for fiscal 2014.

Equity Awards. Compensation may be awarded to our named executive officers in the form of equity-based awards. Equity awards, which are issued pursuant to our 2008 Stock Option and Stock Incentive Plan, can focus our executive officers on our key long-term financial and strategic objectives and encourage them to take into account our and our shareholders’ long-term interests through ownership of our common stock. Awards made under our 2008 Stock Option and Stock Incentive Plan recognize an executive’s contribution to our overall corporate performance and provide a financial incentive to them to achieve our long-term goals.

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Our 2008 Stock Option and Stock Incentive Plan is designed to provide the Compensation Committee the flexibility to award long-term equity compensation incentives from several types of equity-based awards, including stock appreciation rights, restricted stock and stock options. From time to time, we have provided our named executive officers with long-term incentives in the form of incentive or non-qualified stock options and grants of restricted stock, which awards typically vest over a five year period, provided the officer remains employed by the Company. The time-vesting element of thethese equity awards is structured as an incentive for continued employment and to align the interest of our officers with those of shareholders. In fiscal 2014, we did not issue stock options or time-vested restricted stock awards to any of our named executive officers.

Historically, we have also provided our named executive officers with equity awards in connection with new hires and promotions. Although we have not established specific target awards governing the receipt, timing or size of such awards, weWe customarily make such equity grants on or soon after the initial date of hire or date of promotion. As such equity awards are intended as an incentive for employment, the amount of each equity award may vary from executive to executive depending on the particular circumstances. Typically, the amount of the equity award is based upon, among other things, the experience, expertise and responsibility of each named executive officer, the financial performance of the Company and such other factors as deemed appropriate, consistent with our previously described compensation philosophy. In addition, with respect to new hires, an initial grant made on or soon after the date of hire serves to help recruit new executives.

In April 2011, we issuedfiscal 2014, the Compensation Committee granted performance-based restricted stock awards to eachMessrs. Darby, Kealey and Kohnke in the amounts set forth in the following table, which vest based upon the achievement of Mr. Bartonthe identified performance goals:

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For purposes of these performance-based restricted stock awards, “adjusted pre-tax income” means the Company’s consolidated pre-tax income before executive bonus expense and Mr. Beretta 20,000 shares of restricted stockbefore “unusual items.” “Unusual items” include all non-recurring items generally excluded from earnings per share and EBITDA and by institutional investors or analysts when evaluating the Company’s performance, such as one-time gains from asset sales, litigation charges or recoveries, impairment charges, and restructuring charges, but including normal provisions for slow moving and obsolete inventory and accounts receivable. As it relates to adjustments for unusual items, (i) fiscal 2014 pre-tax income was adjusted for a $1.0 million reduction in earn-out payable in connection with promoting each such individualour May 2013 acquisition of Re-Involt Technologies, Inc., and (ii) there was no adjustment to fiscal 2013 pre-tax income for one-time or unusual items. Our growth in fiscal 2014 adjusted pre-tax income was 8%. Accordingly, the restricted shares subject to the position of co-President of the Company. In April 2011, we also issued to Mr. Kohnke 5,000 shares of restricted stock in connection with promoting him to the position of Chief Financial Officer. Thefiscal 2014 performance-based restricted stock awards issued to Messrs. Barton, Beretta and Kohnke vest in five equal annual installments beginning on the first anniversarynamed executive officers did not vest.

Going forward, the Compensation Committee intends to continue to provide our named executive officers with performance-based equity awards. On May 16, 2014, our shareholders approved updated material terms of the grant date.performance goals which will be applicable to future equity awards under the 2008 Stock Option and Stock Incentive Plan. The Compensation Committee intends to structure such future performance-based restricted stock awards under the 2008 Stock Option and Stock Incentive Plan as “performance-based compensation” eligible for tax deductibility under Section 162(m) of the Code.

401(k) Retirement Plan. All of our employees, including our executive officers, are entitled to participate in the Company’s 401(k) Retirement Plan and to receive a portion of the Company’s voluntary contribution in either cash or shares of the Company’s common stock in accordance with the terms of the 401(k) Retirement Plan. We offer the 401(k) Retirement Plan, including the Company’s voluntary contribution, to enhance our ability to attract and retain talented executives and other key employees and to encourage them to systematically save for retirement.

The 401(k) Retirement Plan is administered by a third-party administrator and is available to all employees once they satisfy certain age and service requirements. Individual accounts are maintained for the cash contributions made on behalf of each eligible employee and each eligible employee has a choice of investment options from among a variety of mutual funds and professionally managed accounts as to the contributions to the account. There are two types of contributions to the 401(k) Retirement Plan: (1) voluntary employee contributions which we deduct from each participating employee’s compensation (subject to certain limits established by law); and (2) a company discretionary contributions,contribution made in cash, common stock or a combination thereof, which are allocated amongis determined by multiplying the participants based onpercentage approved by the Compensation Committee by the employee’s annual compensation compared to the total annual compensation of all eligible employees.compensation.

Benefits are payable at age 65 (normal retirement), total disability, death, or upon early employment termination. There are vesting requirements for our contributions, but not for the officer’s voluntary contributions. The vesting schedule provides for twenty percent20% vesting each year after one year of service, with one hundred percent100% vesting at six years or more.

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For the fiscal year 2011,2014, we contributed an amount equal to four percent of each eligible officer’s annual compensation (with certain limitations to highly compensated employees). Our contribution was funded entirely in cash.

Non-Qualified Deferred Compensation Plan. On January 25, 2011, our Compensation Committee approved a Non-Qualified Deferred Compensation Plan. All of our named executive officers are eligible to participate in the Non-Qualified Deferred Compensation Plan. Our Non-Qualified Deferred Compensation Plan is intended to benefit a select group of our highly compensated contributors who are key to our future success and to help attract and retain management talent going forward. Our Non-Qualified Deferred Compensation Plan is an unfunded arrangement and is intended to be exempt from the participation, vesting, funding and fiduciary requirements of the Employee Retirement Income Security Act of 1974, as amended (ERISA)(“ERISA”). This Non-Qualified Deferred Compensation Plan is intended to comply with Section 409A of the Code.

Under our Non-Qualified Deferred Compensation Plan, a participant may contribute, on a tax deferred basis, 25% of his base salary and 90% of his bonus annually. A participant’s account is notionally invested in one or more investment funds and the value of the account is determined with respect to such investment allocations. The minimum deferral period is two years for in-service accounts. Each participant is 100% vested in all of his deferred

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contributions plus any earnings or losses on the investment of such deferrals. Deferred amounts will be distributed, either in lump sum or in equal installments up to five years depending upon the participant’s balance, upon the occurrence of the following events: (i) the first day of the seventh month after separation of employment, (ii) as elected after a minimum deferral period, (either lump sum or in equal installments up to 5 years), (iii) death, (iv) disability (as defined by Section 409A of the Code), or (v) the occurrence of an “unforeseen emergency” as defined in the Non-Qualified Deferred Compensation Plan. Although the Non-Qualified Deferred Compensation Plan permits discretionary employer contributions, we have not yet made a contribution to the plan.

In order for our Non-Qualified Deferred Compensation Plan to comply with the applicable requirements of the Code, amounts deferred by our named executive officers must remain as employer assets, subject to the claims of the general creditors in the event of bankruptcy or forced liquidation of the Company.

Employee Stock Purchase Plan. During fiscal year 2011, executive officers were entitled to participate in the Company’s Employee Stock Purchase Plan subject to the restrictions and limitations in the Employee Stock Purchase Plan. Under the Employee Stock Purchase Plan, participating employees were entitled to purchase shares of the Company’s common stock at a fifteen percent discount to the current trading price. The Plan was originally intended to permit the participation in the future growth and earnings of the Company across a broad base of the Company’s employees, however, the Company’s Board determined that the Employee Stock Purchase Plan no longer achieved this purpose. Consequently, on May 18, 2011, the Board voted to terminate the Employee Stock Purchase Plan effective December 31, 2011.

Agreements with Named Executive Officers. In April 2008, we entered into an employment agreementsagreement with Steven L. Berman and the late Richard N.Mr. Berman in order to provide further stability and continuity in the management of our company.the Company. In negotiating the employment agreements,agreement with Mr. Berman, the Compensation Committee analyzed the terms of employment arrangements for comparable executives employed by other publicly held companies. The committeeCompensation Committee also considered each executive officer’sMr. Berman’s responsibilities and contributions to our strategic business development, as well as our aggregate potential obligations under each employmentthe agreement, including payments to an executive upon termination of employment. See “—Narrative Disclosure to Summary Compensation and Grants of Plan-Based Awards Tables” for a discussion of the employment agreementsagreement with our named executive officers.Mr. Berman. In addition to the employment agreementsagreement with Steven L. Berman and the late Richard N.Mr. Berman, we have agreed to provide our Co-Presidents, Messrs.Mr. Barton and Beretta, with six months’ salary continuation in the event of a termination of employment without “cause,” as determined by the Compensation Committee.

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Post-Employment and Change in Control Benefits. Under the employment agreementsagreement with Mr. Berman and the severance arrangements with our named executive officers,Messrs. Barton and Darby, severance payments provided by us include a salary continuation component over a specified term. In addition, the employment agreementsagreement with Steven L.Mr. Berman andprovides for annual cash payments in the late Richard N. Berman provide for three yearsamount of annual payments$150,000 in lieu of bonusannual bonuses for the remainder of the term and continued medical, dental, vision and hospitalization insurance benefits. Severance benefits may also include the accelerated vesting of stock options and restricted stock awards. The severance arrangementsarrangement with Messrs.Mr. Barton and Beretta provideprovides for severance payments upon any termination of employment other than for “cause,” as determined by the Compensation Committee. The severance arrangement with Mr. Darby provides for severance payments in the event of termination for events outside of his control.

Generally speaking, we provide severance to our executives to give them financial security in the event they suffer an involuntary termination other than for cause. The payment of the severance benefits is linked to our compensation philosophy of encouraging the retention of our executives that successfully contribute to our annual and long-term goals.

The employment agreementsagreement with Steven L.Mr. Berman and the late Richard N. Berman provideprovides for severance benefits pursuant to a “modified single trigger” in the event of a change in control of our company;the Company; that is, the executiveMr. Berman is entitled to the severance benefits for any termination within 12 months following a “Change in Control,” as defined in eachhis employment agreement, other than for death, “Disability” or “Cause,” as such terms are defined in eachthe employment agreement. We believe that a “modified single trigger” change in control provision (i) provides a powerful retention device during change in control discussions, and (ii) ensures our named executive officers areMr. Berman is not deprived of the benefits that they earned or reasonably should expectexpected to receivebe received if there was no change in control. See “—Potential Payments upon Termination or Change in Control” for a summary of the termination provisions in the agreementsemployment agreement with our named executive officers.Mr. Berman.

Perquisites and other Benefits. We annually review the perquisites that our executive officers receive. Each named executive officer receives an auto allowance, which perquisite was discontinued for 2012. All members of senior management, including our named executive officers, are eligible to participate in the Company’s other benefits plans on the same terms as our other employees, which plans include medical, dental and life insurance. Relocation benefits are generally reimbursed pursuant to our relocation benefits policy but may be individually negotiated on an as needed basis.

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Stock Ownership Guidelines

Consistent with our executive compensation philosophy and the principle of aligning executive and shareholder interests, our Compensation Committee adopted stock ownership guidelines, effective as of January 1, 2015, which require our named executive officers to maintain minimum ownership levels of our common stock. Under these guidelines, our CEO is expected to own shares of our common stock that have a value at least equal to six times his annual base salary and each of our other named executive officers is expected to own shares of our common stock that have a value at least equal to three times his annual base salary.

Shares that are counted for purposes of satisfying ownership requirements include:

Stock options and unvested restricted stock will not be considered when determining an individual’s stock ownership. All of our named executive officers must comply with these ownership requirements within five years following the later of (i) his date of hire or promotion, or (ii) January 1, 2015.

The foregoing stock ownership requirements will be measured annually in January. For purposes of the measurement, the individual’s stock ownership shall be valued based on the average closing price of our common stock for the prior calendar year.

Compensation Committee Report

The information contained in this Compensation Committee report is not “soliciting material” and has not been “filed” with the SEC. This report will not be incorporated by reference into any of our future filings under the Securities Act of 1933 or the Exchange Act, except to the extent that we may specifically incorporate it by reference into a future filing.

The Compensation Committee met with management and reviewed and discussed with management the Compensation Discussion and Analysis. Based upon the review and discussions referred to above, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement and in the Annual Report on Form 10-K of the Company for the fiscal year ended December 31, 2011.

Compensation Committee27, 2014.

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Summary Compensation Table for Fiscal 2014

The following table sets forth summary information relating to all compensation awarded to, earned by or paid to the following individuals, collectively referred to as our “named executive officers,” for all services rendered in all capacities to us and our subsidiaries during the fiscal years ended December 31, 2011, December 25, 2010 and December 26, 2009, respectively:noted below:

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Grants of Plan-Based Awards in Fiscal Year Ended December 31, 201127, 2014

The following table sets forth information regarding grants of plan-based awards to our named executive officers during the fiscal year ended December 31, 2011.27, 2014.

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The target amounts reflected in the table are calculated based on the actual fiscal 2014 results of: growth in fiscal 2014 adjusted pre-tax income of 8% and the Company’s three-year compounded growth in adjusted pre-tax income of 16.8%. Such fiscal 2014 results were not known at the time the non-equity incentive plan awards were granted.

See “—Compensation Discussion and Analysis—The Components of the Executive Compensation Program—Performance-Based Bonuses” for a further discussion of the Company’s Executive Cash Bonus Plan and a description of the definition of adjusted pre-tax income. Actual cash amounts paid under the Executive Cash Bonus Plan are shown in the “Non-Equity Incentive Plan Compensation” column of the “Summary Compensation Table.”

Narrative Disclosure to Summary Compensation Tableand Grants of Plan-Based Awards Tables

Employment AgreementsAgreement with Messrs. Steven L. Berman and the Late Richard N. Berman

On April 1, 2008, we entered into an employment agreementsagreement with each of Steven L. Berman, our Chairman of the Board, Chief Executive Officer and Secretary-Treasurer, and the late Richard N. Berman, our former Chairman of the Board and Chief Executive Officer.Mr. Berman. The agreementsagreement had an initial term of three years expiring March 31, 2011. On each anniversary of the effective date of the agreements,agreement, the term of eachthe agreement automatically extends for an additional one year unless further extended or earlier terminated as provided in eachthe agreement. Accordingly, in effect, the term of Mr. Berman’s employment agreement is a rolling three year period unless earlier terminated.

Pursuant to the employment agreements,agreement, annual base salary was initially set at $514,370 per year, subject to increase but not decrease from time to time as determined by the Compensation Committee. Each of theThe employment agreementsagreement also provides for (i) eligibility for (i) an annual bonus and other benefits provided under the Executive Cash Bonus Plan or other plans maintained by us, and (ii) grants of awards under the Company,2008 Stock Option and Stock Incentive Plan or other equity-related incentive plans maintained by us, in case of both clauses (i) and (ii) in such amounts as determined by the Compensation Committee, in its sole discretion; and (ii) eligibilitydiscretion. Further, the employment agreement provides that Mr. Berman will be eligible to participate in other employment benefits plans or arrangements generally available to our executive officers of the Company,and not less than four weeks paid vacation per year and the use of an automobile and related expenses provided for by the Company.year.

The employment agreementsagreement may be terminated by us with or without “Cause” or by the named executive officerMr. Berman for “Good Reason” or for no reason, as such terms are defined in the agreements.

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Each of theThe employment agreementsagreement also provides for non-solicitation and non-competition provisions for the term of suchthe agreement and two years thereafter. The agreementsagreement also includeincludes standard confidentiality and trade secret provisions typically included in agreements of this type.

Additionally, the employment agreements containagreement contains provisions that provide for certain payments upon termination or a change in control of our company. As a result of Richard N. Berman’s passing in January 2011, we shall provide to the estate of Richard N. Berman pursuant to his employment agreement: (i) base salary payments until the expiration of the term of the agreement in accordance with the usual payroll practices of the Company, in the amount $562,248 per term year; (ii) in lieu of annual bonus payments, annual cash payments in the amount of $150,000 per term year, payable on each March 15 during the remainder of the term of the agreement; and (iii) for the remainder of the term of the agreement, on behalf of Mr. Berman and his dependents and beneficiaries, any medical, dental, vision and hospitalization benefits provided to Mr. Berman immediately prior to the date of his death, in the approximate amount of $12,000 per term year. See “—“—Potential Payments upon Termination or Change in Control” for a discussion of potential payments to Steven L.Mr. Berman upon a termination of his employment with us.

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2008 Stock Option and Stock Incentive Plan

The purpose of the 2008 Stock Option and Stock Incentive Plan is to assist us in attracting, motivating, retaining and rewarding executives and other employees, officers, directors, consultants and advisors who provide services to us, by enabling such persons to invest in our common stock and thereby acquire a proprietary interest in the Company and an increased personal interest in our continued success and progress. Pursuant to the plan, we may grant (i) stock options to purchase our common stock which are intended to qualify as incentive stock options under Section 422 of the Code and the regulations promulgated thereunder, (ii) stock options to purchase our common stock not intended to so qualify, and (iii) restricted shares of our common stock.

The maximum number of shares which may be issued under the 2008 Stock Option and Stock Incentive Plan, is 1,000,000we may grant up to 2,000,000 shares of our common stock subject(subject to adjustment as provided by the plan. plan) in the form of shares of restricted stock, incentive stock options and non-qualified stock options or combinations thereof.

Up to 500,0001,000,000 shares of common stock may be issued upon the exercise of incentive stock options. The plan imposes individual limitations on the amount of certain equity awards. No outside director may receive equity awards under the plan which in the aggregate equal more than 50% of the total number of shares of common stock authorized for issuance under the plan and no officer, employee or consultant may receive equity awards under the plan which in the aggregate equal more than 90% of the total number of shares of common stock authorized for issuance under the plan. No individual may receive equity awards of more than 50% of the shares reserved for issuance under the plan in any calendar year.

The 2008 Stock Option and Stock Incentive Plan is administered by the Compensation Committee. Subject to the provisions of the plan, the Compensation Committee determines, among other things, which of our officers, directors, employees, consultants and advisors will be granted equity awards under the plan, whether awards granted will be incentive stock options, non-qualified options, or restricted shares, the number of shares subject to an equity award, the time at which an equity award is granted, the rate of vesting for restricted shares, performance goals, if any, applicable to an award, the rate of exercisability for an option award, the duration of an equity award, acceleration of vesting of an equity award upon a change in control of the Company, and, subject to the terms of the plan, the exercise price of an option. The Compensation Committee has the exclusive right to adopt or rescind rules for the administration of the plan, correct defects and omissions in, reconcile inconsistencies in, and construe the plan. The Compensation Committee also has the right to modify, suspend or terminate the plan, subject to certain conditions.

On May 30, 2013, the Compensation Committee amended the 2008 Stock Option and Stock Incentive Plan to permit, in its discretion, the delegation to one or more officers of the Company all or part of the Committee’s authority and duties with respect to grants and awards (i) to individuals who are not subject to the reporting and other provisions of Section 16 of the Exchange Act, and (ii) that are not intended to qualify as “performance-based compensation” for purposes of Code Section 162(m). The Compensation Committee may revoke or amend the terms of a delegation at any time but such action shall not invalidate any prior actions of the Committee’s delegate or delegates that were consistent with the terms of the 2008 Stock Option and Stock Incentive Plan. Pursuant to the 2008 Stock Option and Stock Incentive Plan, as amended, the Compensation Committee delegated to Mr. Steven L. Berman, the Company’s Chief Executive Officer, the authority to award up to a total of 10,000 shares of restricted stock during fiscal 2014.

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The Board reserves the right at any time, and from time to time, to amend or supplement the 2008 Stock Option and Stock Incentive Plan in any way or to suspend or terminate it. If an amendment or supplement of the plan is required by the Code to be approved by our shareholders in order to permit the granting of incentive stock options pursuant to the amended or supplemented plan, such amendment or supplement shall also be approved by our shareholders in such manner as is prescribed by the Code. If the Board voluntarily submits a proposed amendment, supplement, suspension or termination for shareholder approval, such submission shall not require any future amendments, supplements, suspensions or terminations (whether or not relating to the same provision or subject matter) to be similarly submitted for shareholder approval.

Outstanding Equity Awards Value at 2011 Fiscal Year End

On May 16, 2014, our shareholders approved updated material terms of the performance goals which will be applicable to future equity awards under the 2008 Stock Option and Stock Incentive Plan. The following table includes certain information with respectCompensation Committee intends to structure future performance-based restricted stock awards under the value2008 Stock Option and Stock Incentive Plan as “performance-based compensation” eligible for tax deductibility under Section 162(m) of all unexercised options previously awarded to the named executive officers at December 31, 2011.Code.

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Outstanding Equity Awards at December 27, 2014

The following table sets forth information regarding unexercised options and unvested stock awards for each of our named executive officers outstanding at December 27, 2014.

Option Exercises and Stock Vested in Fiscal Year Ended December 31, 201127, 2014

The following table provides information about the value realized by the named executive officers onupon the exercise of option awards and the vesting of stock awards during the fiscal year ended December 31, 2011.27, 2014.

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Non-Qualified Deferred Compensation During Fiscal Year Ended December 31, 201127, 2014

The following table sets forth the benefits received by our named executive officers under our non-qualified deferred compensation plan during the fiscal year ended December 31, 201127, 2014 as well as the aggregate non-qualified deferred compensation balances at December 31, 2011:27, 2014:

Narrative Disclosure to Non-Qualified Deferred Compensation Table

Our Non-Qualified Deferred Compensation Plan is intended to benefit a select group of our highly compensated contributors, including our named executive officers, who are key to our future success and to help attract and retain management talent going forward. Our Non-Qualified Deferred Compensation Plan is an unfunded arrangement and is intended to be exempt from the participation, vesting, funding and fiduciary requirements of ERISA and comply with Section 409A of the Code.

Under our Non-Qualified Deferred Compensation Plan, a participant may contribute, on a tax deferred basis, 25% of his base salary and 90% of his bonus annually. A participant’s account is notionally invested in one or more investment funds and the value of the account is determined with respect to such investment allocations. The minimum deferral period is two years for in-service accounts. Each participant is 100% vested in all of his or her deferred contributions plus any earnings or losses on the investment of such deferrals. Deferred amounts will be distributed, either in lump sum or in equal installments up to five years depending upon the participant’s balance, upon the occurrence of the following events: (i) the first day of the seventh month after separation of employment, (ii) as elected after a minimum deferral period, (either lump sum or in equal installments up to 5 years), (iii) death, (iv) disability (as defined by Section 409A of the Code), or (v) the occurrence of an “unforeseen emergency,”emergency” as defined in the Non-Qualified Deferred Compensation Plan. Although the Non-Qualified Deferred Compensation Plan permits discretionary employer contributions, we have not yet made a contribution to the plan.

In order for our Non-Qualified Deferred Compensation Plan to comply with the applicable requirements of the Code, amounts deferred by our named executive officers must remain as employer assets, subject to the claims of the general creditors in the event of bankruptcy or forced liquidation of the Company.

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Potential Payments upon Termination or Change in Control

In 2011,fiscal 2014, upon termination of employment and/or upon a change in control, our named executive officers would have been entitled to receive from us potential payments and benefits under the following agreements and plans:

Employment Agreement with Steven L. Berman

Employment Agreement Terms

The employment agreement with Steven L.Mr. Berman specifies our obligations to Mr. Berman upon termination of his employment under various circumstances. The employment agreement may be terminated (i) upon Mr. Berman’s death, (ii) by us on 90 days written notice upon the “Disability” of Mr. Berman, (iii) by us upon written notice to Mr. Berman without “Cause” or with “Cause,” provided Mr. Berman will be given five business days to appear with counsel before the Compensation Committee to present information regarding his views on thea Cause event and overturn the termination decision, (iv) by Mr. Berman upon 60 days written notice without “Good Reason,” (v) at any time prior to the 120^th day after any event providing “Good Reason,” provided that within 90 days of any such event having occurred Mr. Berman has provided written notice and afforded the Company 30 days to cure such event, or (vi) by Mr. Berman for any reason within 12 months following a “Change in Control,” other than for death, Disability or Cause.

Under the terms of Mr. Berman’s employment agreement, “Disability” means Mr. Berman’s “disability” under the Company’s long-term disability plan, if any, otherwise, his inability to perform his duties and responsibilities under the agreement, with or without reasonable accommodation, due to any physical or mental illness or incapacity, which condition either (i) has continued for a period of 270 days (including weekends and holidays) in any consecutive 365-day period, or (ii) is projected by the Board, in good faith after consulting with a physician selected by the Company, that the condition is likely to continue for a period of at least nine consecutive months from its commencement.

Under the terms of Mr. Berman’s employment agreement, “Cause” means the occurrence of any one of the following as determined by our Board: (i) the willful and continued failure by Mr. Berman to attempt in good faith substantially to perform his obligations under the agreement (other than any such failure resulting from incapacity due to a Disability); provided, however, that the Company shall have provided written notice that such actions are occurring and, where practical, afforded at least 30 days to cure; (ii) the indictment of Mr. Berman for, or his conviction of or plea of guilty or nolo contendere to, a felony or any other crime involving moral turpitude or dishonesty; or (iii) Mr. Berman’s willfully engaging in misconduct in the performance of his duties for the Company or other than in the performance of his duties for the Company (including, but not limited to, theft, fraud, embezzlement, and securities law violations or a violation of the Company’s code of conduct or other written policies) that is materially injurious to the Company, or, in the good faith determination of the Compensation Committee, is potentially materially injurious to the Company, monetarily or otherwise.

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Under the terms of Mr. Berman’s employment agreement, “Good Reason” means the occurrence of any of the following events without Mr. Berman’s consent: (i) a material diminution of the authorities, duties or responsibilities as set forth in the agreement; (ii) the loss of any titles with the Company as set forth in the agreement; (iii) a reduction by the Company in base salary; (iv) a material change in the primary place of employment; (v) the failure by the CompensationCorporate Governance and Nominating Committee to nominate or re-nominate Mr. Berman as a member of the Board, or removal ofif the Board removes Mr. Berman as a member of the Board (other than as a result of or due to death or Disability, because of a legal prohibition under applicable law or regulation, or for Cause); (vi) the assignment to Mr. Berman of duties or responsibilities which are materially inconsistent with any of his duties and responsibilities set forth in the agreement; or (vii) a change in the reporting structure so that Mr. Berman reports to someone other than as specified insolely and directly to the agreement.Board.

Under the terms of Mr. Berman’s employment agreement, “Change in Control” means the occurrence of any one of the following eventsevents: (i) any person or other entity (other than any of the Company’s subsidiaries or any employee benefit plan sponsored by the Company or any of its subsidiaries), including any person as defined in Section 13(d)(3) of the Exchange Act, becomes the beneficial owner, as defined in Rule13d-3 under the Exchange Act, directly or indirectly, of more than 50% of the total combined voting power of all classes of capital stock of the Company normally entitled to vote for the election of directors of the Company, referred to as the “Voting Stock”;Stock;” (ii) the Board and/or the shareholders of the Company approve the sale of all or substantially all of the property or assets of the Company and such sale occurs; (iii) the Board and/or the shareholders of the Company approve a consolidation or merger of the Company with another entity (other than with any of the Company’s subsidiaries), the consummation of which would result in the shareholders of the Company immediately before the occurrence of the consolidation or merger owning, in the aggregate, less than 50% of the Voting Stock of the surviving entity, and such consolidation or merger occurs; or (iv) a change in the Board occurs with the result that the members of the Board on the effective date of this Agreement,the agreement, referred to as the “Incumbent Directors,” no longer constitute a majority of such board of directors, provided that any person becoming a director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest or the settlement thereof, including but not limited to a consent solicitation, relating to the election of directors of the Company) whose election or nomination for election was supported by more than half of the then Incumbent Directors shall be considered an Incumbent Director for purposes hereof.Director.

Employment Agreement Benefits

Upon the termination of Mr. Berman’s employment for Cause or by Mr. Berman without Good Reason, Mr. Berman shall receive: (i) any earned but unpaid base salary through the date of termination, paid in accordance with the Company’s standard payroll practices; (ii) reimbursement for any unreimbursed expenses properly incurred and paid in accordance with the Company’s business expense reimbursement policy; (iii) payment for any accrued but unused vacation time in accordance with Company policy; and (iv) such vested accrued benefits, and other payments, if any, as to which Mr. Berman (and his eligible dependents) may be entitled under, and in accordance with, the terms and conditions of, the employee benefit arrangements, plans and programs of the Company as of the date of termination, (i) though (iv) collectively referred to as the “Amounts and Benefits.”

Upon the termination of Mr. Berman’s employment by death or Disability, for Good Reason or without Cause, or within 12 months following a Change in Control, other than for death, Disability or Cause, Mr. Berman or his estate shall receive: (i) the Amounts and Benefits; (ii) base salary payments until the expiration of the term of the agreement in accordance with the usual payroll practices of the Company, referred to as the “salary continuation benefits”;benefits;” (iii) in lieu of annual bonuses, annual cash payments in the amount of $150,000, on each March 15 during the remainder of the term of the agreement, referred to as the “payments in lieu of bonus”;bonus;” and (iv) for the remainder of the term of the agreement, the Company shall continue on behalf of Mr. Berman and his dependents and beneficiaries any medical, dental, vision and hospitalization benefits provided to Mr. Berman immediately prior to the date of termination or reimburse Mr. Berman for his medical, dental, vision and hospitalization related expenses, referred to as the “health benefits.” The Company’s obligation with respect to the health benefits are limited to the extent that Mr. Berman obtains any such benefits pursuant to a subsequent employer’s benefit plans, in which case the Company may reduce the coverage of any health benefits it is required to provide as long as the aggregate coverages and benefits of the combined benefit plans are no less favorable than the coverages and benefits required to be provided under the agreement.

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Mr. Berman’s employment agreement further provides that in the event that there is an excise tax imposed with respect to any payment, or portion of any payment, described above as a result of or in connection with a change of control, Mr. Berman will be paid an additional tax gross-up payment to offset the effect of the excise tax.

Notwithstanding any provision to the contrary in the employment agreement, the Company’s obligation to pay or to provide the above payments and benefits (other than the Amounts and Benefits) are conditioned on Mr. Berman executing and not revoking a waiver and general release.

Severance Arrangements with Messrs. Barton and BerettaDarby

We have agreed to provide each of Mathias J.Mr. Barton, and Joseph M. Beretta, our co-Presidents, in the event of theMr. Barton’s termination of such executive’s respective employment without “cause” as determined by the Compensation Committee, with six months of salary continuation paid in accordance with the Company’s standard payroll practices. Under thethis severance arrangements,arrangement, “cause” means (i) the gross neglect or willful failure by the executiveMr. Barton to perform his duties and responsibilities in all material respects; (ii) any act of fraud by the executive,Mr. Barton, whether relating to the Company and its subsidiaries or otherwise; (iii) the conviction or entry into a plea of nolo contendere by the executiveMr. Barton with respect to any felony or misdemeanor (other than a traffic offense which does not result in imprisonment); or (iv) the commission by the executiveMr. Barton of any willful or intentional act (including any violation of law) which materially injures the reputation or materially adversely affects the business or business relationships of the Company. For purposes of this definition, no act, or failure to act, on the executive’sMr. Barton’s part shall be deemed “willful” unless done, or omitted to be done, by the executiveMr. Barton not in good faith and without reasonable belief that the executive’shis act, or failure to act, was in the best interest of the Company.

We have agreed to provide Mr. Darby, in the event of Mr. Darby’s termination for events outside of Mr. Darby’s control, with a severance payment equal to 50% of his then current base salary per month for the 12 consecutive months following his last day of employment. Termination for events “outside of Mr. Darby’s control” would include events such as a business down-turn or other circumstances unrelated to Mr. Darby’s performance or conduct. Events not outside of Mr. Darby’s control would include poor job performance or Mr. Darby’s failure to comply with the Company’s directives, policies, and procedures. Upon written notice to Mr. Darby, the Company may release Mr. Darby from his non-competition and non-solicitation obligations, at which point the Company’s obligation to make the monthly payments described above will end.

2008 Stock Option and Stock Incentive Plan

The table below sets forth the benefits that each named executive officer holding restricted stock awards granted under our 2008 Stock Option and Stock Incentive Plan would be entitled to receive should his employment terminate under the following specified circumstances or in the event of a change in control of the Company pursuant to the terms of the plan2008 Stock Option and Stock Incentive Plan and our standard restricted stock agreement and stock option awards thereunder:

Under our 2008 Stock Option and Stock Incentive Plan and our standard restricted stock agreement and stock option awards thereunder, a “change in control” means: (i) a change within a 12 month period in the holders of more than 50% of the outstanding voting stock of the Company; or (ii) any other events deemed to constitute a “change in control” by the Compensation Committee.

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2000 Incentive Plan

The table below sets forth the benefits that each named executive officer holding options granted under our 2000 Incentive Plan would be entitled to receive in the event of a change in control of our Company pursuant to the terms of the plan and our standard stock option awards thereunder:

Under our 2000 Incentive Plan and our standard stock option awards thereunder, a “change in control” includes: the Company being merged into or consolidated with or otherwise combined with or acquired by another person or entity, or a divisive reorganization or a liquidation or partial liquidation of the Company.

Executive Cash Bonus Plan

Under our Executive Cash Bonus Plan, the Compensation Committee, in its sole and absolute discretion and to the extent permitted under and in accordance with Section 162(m) of the Code and Section 409A of the Code, may, but is not required to, make a full or pro-rated bonus payment to a plan participant for a plan year in the event of the participant’s death, disability, retirement or termination of employment during the plan year or after the end of the plan year; provided, that payments shall only be made on the earlier of (i) the death or disability of the participant or (ii) the scheduled payment date, as set forth above, referred to collectively as the “Pro-Rated Bonus.”

Potential Payments to Our Named Executive Officers upon Termination or Change in Control

Potential Payments upon Termination

The following table shows the estimated maximum amount of payments and benefits that would be provided by us (or our successor) to Steven L.Mr. Berman under the plans and agreements described above assuming that theirhis employment was terminated as of December 31, 201127, 2014 for various reasons as described below:

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The following table shows the estimated maximum amount of payments and benefits that would be provided by us (or our successor) to each of Messrs. Barton, BerettaDarby, Kealey, and Kohnke under the plans and agreements described above assuming that their employment was terminated as of December 31, 201127, 2014 for various reasons as described below: