UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

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 Party other than the Registrant  ¨☐

Check the appropriate box:

POWER SOLUTIONS INTERNATIONAL, INC.

(Name of Registrant as Specified In Its Charter)

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

Payment of Filing Feefiling fee (Check the appropriate box):

Power Solutions International, Inc.

POWER SOLUTIONS INTERNATIONAL, INC.

201 Mittel Drive

Wood Dale, Illinois 60191

(630) 350-9400

July 17, 2015June 1, 2021

Dear Stockholder:Fellow Stockholders:

On behalf of the Board of Directors of Power Solutions International, Inc., Iand management, we cordially invite you to attend the 20152021 Annual Meeting of Stockholders of Power Solutions International, Inc., which on Thursday, July 15, 2021, at 8:00 a.m. (Central Daylight Time) (the “Annual Meeting”). Due to the continuing public health impact of the coronavirus (“COVID-19”) pandemic, and out of concern for the health and safety of our stockholders, employees and directors, this year’s Annual Meeting again will be helda virtual meeting of the stockholders, with no physical, in-person meeting. You will be able to attend the Annual Meeting online, vote your shares electronically, and submit your questions during the Annual Meeting by visiting www.virtualshareholdermeeting.com/PSIX2021 and entering your control number. You will not be able to attend the Annual Meeting in person.

The proxy statement relates to 2020 performance and compensation, which were affected by the COVID-19 pandemic. During 2020, the Board of Directors and management implemented certain actions to partly mitigate the significant negative impacts that the COVID-19 pandemic had on August 13, 2015, at 10:00 a.m., Central Time,the Company’s business operations and financial results. Details about the business to be conducted at the officesAnnual Meeting and other information can be found in the attached Notice of Power Solutions International, Inc., 101 Mittel Drive, Wood Dale, Illinois 60191.Annual Meeting of Stockholders and Proxy Statement. As a stockholder of record, you will be asked to vote on three proposals.

The accompanyingWhether or not you plan to virtually attend the Annual Meeting, your vote is important. After reading the attached Notice of Annual Meeting of Stockholders and Proxy Statement, describe matters that we expect will be acted upon atplease submit your proxy or voting instructions promptly. We encourage you to vote your shares prior to the Annual Meeting. Only stockholders

On behalf of record at the close of business on July 2, 2015 may vote atmanagement team and the annual meeting or any adjournment or postponement thereof.

It is important that your views be represented, whether or not you are able to be present at the Annual Meeting. Please complete, sign and date the enclosed proxy card and promptly return it via mail, telephone or through the internet according to the instructions on the proxy card, whether or not you plan to attend the Annual Meeting. If you sign and return your proxy card without specifying your choices, it will be understood that you wish to have your shares voted in accordance with the recommendations of our Board of Directors, contained in the Proxy Statement.

We are gratified bythank you for your continued support and interest in Power Solutions International, Inc. and urge you to vote your shares as soon as possible.

Chief Executive Officer, President and Chairman of the Board

Power Solutions, Inc.

201 Mittel Drive

Wood Dale, Illinois 60191

July 17, 2015

POWER SOLUTIONS INTERNATIONAL, INC.

201 Mittel Drive

Wood Dale, Illinois 60191

(630) 350-9400

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD ON AUGUST 13, 2015To Be Held on July 15, 2021

To the Stockholders of

Power Solutions International, Inc.:

The 2021 Annual Meeting of Stockholders (the “Annual Meeting”) of Power Solutions International, Inc., a Delaware corporation (the “Company”) will be held on August 13, 2015,Thursday, July 15, 2021, at 10:8:00 a.m., Central Time, at (Central Daylight Time). Due to the officescontinuing public health impact of the Company, 101 Mittel Drive, Wood Dale, Illinois 60191,COVID-19 pandemic, and out of concern for the health and safety of the Company’s stockholders, employees and directors, this year’s Annual Meeting again will be a virtual meeting of the stockholders, with no physical, in-person meeting. You will be able to attend the Annual Meeting online, vote your shares electronically, and submit your questions during the Annual Meeting by visiting www.virtualshareholdermeeting.com/PSIX2021 and entering your control number.

The Annual Meeting will be held for the following purposes,purposes:

These items of business, including the nominees for director, are more fully described in the proxy statement accompanying Proxy Statement:

(1) To re-elect Gary S. Winemaster, Kenneth W. Landini, Jay J. Hansen and Mary E. Vogt to the Company’s Board of Directors, each for a one-year term expiring at the 2016 Annual Meeting of Stockholders and until his or her successor is elected and qualified;

(2) To approve, in a non-binding advisory vote, the compensation paid to our named executive officers as set forth herein;

(3) To ratify the appointment by the Board of Directors of independent registered public accounting firm McGladrey LLP as the independent auditors of the Company’s financial statements for the year ending December 31, 2015; and

(4) To act upon any other matters properly brought before the Annual Meeting of Stockholders.

Your vote is important. All stockholders are urged to attend the meeting in person or by proxy. Whether or not you expect to be present at the meeting, please complete, sign and date the enclosed proxy card and return it promptly via mail, telephone or through the internet according to the instructions on the proxy card. Stockholders attending the meeting may vote in person even if they have previously returned proxy cards.this notice.

The Board of Directors has fixed the close of business on July 2, 2015May 17, 2021, as the record date for determining the stockholders entitled to receive notice of and to vote at the meeting.Annual Meeting and any adjournment or postponement thereof. Stockholders who hold shares in street name may vote through their brokers, banks or other nominees.

By OrderThe Company is pleased to take advantage of the Board of Directors,

Gary S. Winemaster

Chief Executive Officer, PresidentSecurities and ChairmanExchange Commission (the “SEC”) rules that allow issuers to furnish proxy materials to stockholders via the Internet. On or about June 1, 2021, the Company will mail to its stockholders a notice containing instructions on how to access the proxy materials and vote on the matters described above. In addition, the notice will include instructions on how you can request a paper copy of the Boardproxy materials.

Regardless of the number of shares you own and whether you plan to virtually attend the Annual Meeting, please vote. All stockholders of record can vote (i) over the Internet by accessing the Internet website specified on the enclosed proxy card or voting instruction form and following the instructions provided to you, (ii) by calling the toll-free telephone number specified on the enclosed proxy card or voting instruction form and following the instructions when prompted, (iii) by written proxy by signing and dating the enclosed proxy card and returning it, or (iv) by attending the Annual Meeting over the Internet, as described in the materials accompanying this notice.

If you submit your proxy and then decide to virtually attend the Annual Meeting to vote your shares electronically, you may still do so. Your proxy is revocable in accordance with the procedures set forth in the proxy statement.

The Company encourages you to receive all proxy materials in the future electronically to help it save printing costs and postage fees, as well as natural resources in producing and distributing these materials. If you wish to receive these materials electronically in the future, please follow the instructions on the proxy card or voting instruction form.

TABLE OF CONTENTS

Power Solutions International, Inc.

201 Mittel Drive

Wood Dale, Illinois 60191

July 17, 2015

POWER SOLUTIONS INTERNATIONAL, INC.

201 Mittel Drive

Wood Dale, Illinois 60191

(630) 350-9400

PROXY STATEMENT

The accompanyingFOR THE 2021 ANNUAL MEETING OF STOCKHOLDERS

To Be Held on July 15, 2021

This proxy is solicitedstatement and enclosed proxy card are being furnished to stockholders of record as of the close of business on May 17, 2021 in connection with the solicitation by the Board of Directors (the “Board”) of Power Solutions International, Inc., a Delaware corporation (“PSI” or the “Company”), of proxies for use in voting at itsthe 2021 Annual Meeting of Stockholders (the “Annual Meeting”) to be held on Thursday, July 15, 2021, at 10:8:00 a.m., Central Time, on August 13, 2015, at (Central Daylight Time). Due to the officescontinuing public health impact of the Company, 101 Mittel Drive, Wood Dale, Illinois 60191,COVID-19 outbreak, and out of concern for the health and safety of our stockholders, directors and employees, this year’s Annual Meeting will be a virtual meeting of the stockholders. Stockholders may attend the Annual Meeting by visiting www.virtualshareholdermeeting.com/PSIX2021, or at any and all adjournments or postponements thereof. You may obtain directions tothereof, for the meeting location from our websitewww.psiengines.compurposes stated in the “Contact Us” section, or by calling (630) 350-9400. This Proxy Statement and accompanying formNotice of proxy are being mailed to stockholders on or about July 17, 2015. As used in this Proxy Statement, the terms “the Company,” “we,” “us” and “our” refer to Power Solutions International, Inc.

Our Annual Report to Stockholders for the fiscal year ended December 31, 2014 (“fiscal 2014”), consisting of our Annual Report on Form 10-K, containing financial and other information pertaining to the Company, is being furnished to stockholders simultaneously with this Proxy Statement.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON AUGUST 13, 2015

The Company’s Proxy Statement for the Annual Meeting of Stockholders

Stockholders. You are receiving the proxy materials because the Board is seeking your permission (or proxy) to be held on August 13, 2015 is available, free of charge, at:

http://www.psiengines.com/proxy

ABOUT THE MEETING

What proposals may I vote onyour shares at the Annual Meeting and how does the Board recommend I vote?

Whoon your behalf. This proxy statement presents information that is entitledintended to vote?

Only stockholders of record ashelp you in reaching a decision on voting your shares of the close of business on July 2, 2015Company’s common stock, par value $0.001 (the “record date”“Common Stock”) are entitled to receive notice of, and.

QUESTIONS AND ANSWERS ABOUT

THESE PROXY MATERIALS AND VOTING

Why am I receiving these materials?

The Company has sent you these proxy materials because its Board is soliciting your proxy to vote at the Annual Meeting, including at any adjournments or any adjournmentpostponements of the meeting. You are invited to virtually attend the Annual Meeting to vote on the proposals described in this proxy statement. However, you do not need to attend the Annual Meeting to vote your shares. Instead, you may simply complete, sign and return the enclosed proxy card, or postponement thereof. Asfollow the instructions on your proxy card or voting instruction form to vote over the telephone or through the Internet.

How do I attend the Annual Meeting?

The Annual Meeting will be held virtually, on Thursday, July 15, 2021, at 8:00 a.m. (Central Daylight Time). To participate in the Annual Meeting visit www.virtualshareholdermeeting.com/PSIX2021 using your desktop or mobile device and enter the control number included on your proxy card. Information on how to vote virtually at the Annual Meeting is discussed below.

Who can vote at the Annual Meeting?

Only stockholders of record at the close of business on May 17, 2021, the record date for the Annual Meeting, we had 10,747,864 shares of our common stock outstanding, and there were no other outstanding classes of stock that arewill be entitled to vote at the Annual Meeting. A record holderAs of

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outstanding May 17, 2021, there were 22,892,413 shares of our common stockCommon Stock outstanding and entitled to vote. For ten days prior to the Annual Meeting, during normal business hours, a complete list of all stockholders on the record date is entitled to one vote per share held on each matter towill be considered. As a result,available for examination by any stockholder at the total numberCompany’s offices at 201 Mittel Drive, Wood Dale, Illinois 60191. The list of votes that maystockholders will also be cast by holders of our common stock for the proposals to be voted onavailable electronically at the Annual Meeting is 10,747,864 votes.Meeting.

Stockholder of Record: Shares held as of the record date include shares that are held directlyRegistered in your name as the registered stockholder of record on the record date and those shares of which you are the beneficial owner on the record date and which are held through a broker, bank or other institution, as nominee, on your behalf, that is considered the stockholder of record of those shares.

What is the difference between holding shares as a stockholder of record and as a beneficial owner?Your Name

Stockholders of Record

If at the close of business on May 17, 2021, your shares of our common stock arewere registered directly in your name with thePSI’s transfer agent, for our common stock, Wells Fargo ShareholderEQ Shareowner Services, then you are a stockholder of record. As a stockholder of record, you may vote virtually at the Annual Meeting or vote by proxy. Whether or not you plan to virtually attend the Annual Meeting, the Company urges you to fill out and return the enclosed proxy card or vote by proxy over the telephone or through the Internet as instructed below to ensure your vote is counted. You are encouraged to vote your shares prior to the Annual Meeting.

Beneficial Owner: Shares Registered in the Name of a Broker or Bank

If at the close of business on May 17, 2021, your shares were held in an account at a brokerage firm, bank, dealer or other similar organization, rather than in your own name, then you are the beneficial owner of shares held in “street name” and these proxy materials are being forwarded to you by that organization. The organization holding your account is considered to be the stockholder of record with respect to those sharesfor purposes of our common stock.

Beneficial Owners

If shares of our common stock are held invoting at the Annual Meeting. As a stock brokerage account, by a broker, bank or other institution, serving as nominee, on your behalf, you are considered the beneficial owner of those shares (sometimes referred to as being held in “street name”). If you are a beneficial owner, your broker or other nominee that is considered the stockholder of record of those shares is making these proxy materials available to you with a request for your voting instructions. As the beneficial owner, you have the right to direct your broker or other nomineeagent regarding how to vote the shares in your account. If you want to vote at the Annual Meeting, follow the instructions on howthe voting instruction form provided by your bank, brokerage firm, or dealer. If you do not submit voting instructions to your broker, your broker may still be permitted to vote your shares using the voting methods which thein certain cases. A broker non-vote occurs when a broker or other nominee offers as options. For a discussion of the rules regarding the voting ofholding shares held by beneficial owners, please see the question titled “How do I vote if I amfor a beneficial owner of sharesdoes not vote on a particular proposal because the broker or nominee does not have discretionary voting power and my broker, bank or other institution holds my shares in ‘street name’?”has not received instructions from the beneficial owner.

How doWhat am I vote if I amvoting on?

There are three matters scheduled for a stockholder of record?

Stockholders of record can vote their shares by either voting in person at the Annual Meeting or by proxy according to the instructions on the enclosed proxy card.Meeting:

Proxies must be received by Wells Fargo Shareholder Services, the transfer agent for our common stock,no later than 3:00 p.m. Central Time on Wednesday, August 12, 2015 via one of the following methods:

A stockholder should complete and return the enclosed proxy card promptly via one of the above methods. Signing and returningholders on the proxy card does not affect the right towill vote in person at the Annual Meeting. Each executed and returned proxy will be voted in accordance with the directions indicated thereon, or if no direction is indicated, such proxy will be voted in accordance with the recommendations of the Board. The recommendation of the Board containedis set forth together with the description of each item in this Proxy Statement and on the proxy card.

Gary S. Winemaster and Catherine V. Andrews, the persons named as proxies on the proxy card accompanying this Proxy Statement, were selected bystatement. In summary, the Board to serve in such capacity. Mr. Winemaster is Chief Executive Officer andrecommends a directorvote:

What if another matter is properly brought before the meeting?

Beneficial Owner: Shares Registered in the Name of Broker or Bank

If you are a beneficial owner of shares registered in the name of your broker, bank or other agent, you should have received a proxy card and voting instructions with these proxy materials onlinefrom that organization rather than from the Company. Simply complete and mail the proxy card to ensure that your vote is counted. Alternatively, you may vote by telephone or through the Internet as instructed by your broker or bank. To vote virtually at the Annual Meeting, follow the instructions on the voting instruction form provided by your bank or brokerage firm. Follow the instructions from your broker or bank included with these proxy materials, or contact your broker or bank to request a paper or email copyproxy form.

How many votes do I have?

On each matter to be voted upon, you have one vote for each share of our proxy materials. Common Stock you owned at the close of business on May 17, 2021, the record date.

What happens if I do not vote?

Stockholder of Record: Shares Registered in Your Name

If you received theseare a stockholder of record and do not vote by completing your proxy materialscard, by telephone, through the Internet or through the virtual meeting platform at the Annual Meeting, your shares will not be voted, nor will your shares count toward the establishment of a quorum for the meeting.

Beneficial Owner: Shares Registered in paper form, the materials includedName of Broker or Bank

If you are a voting instruction card so you canbeneficial owner and do not instruct your broker, bank or other nomineeagent how to vote your shares.shares, the question of whether your broker or nominee will still be able to vote your shares depends on whether the proposal is considered to be a “routine” matter.

See below under “What are broker Fornon-votes?” for more information. At the Annual Meeting, only Proposal 2 is considered to be a discussionroutine matter. Accordingly, without your instructions, your broker or nominee may not vote your shares on Proposal 1 and Proposal 3, but may vote your shares on Proposal 2.

Who is paying for this proxy solicitation?

The Company will pay for the entire cost of soliciting proxies. In addition to these proxy materials, the rules regardingCompany’s directors and employees may also solicit proxies in person, by telephone, or by other means of communication. Directors and employees will not be paid any additional compensation for soliciting proxies. The Company may also reimburse brokerage firms, banks and other agents for the cost of forwarding proxy materials to beneficial owners.

What does it mean if I receive more than one set of proxy materials?

If you receive more than one set of proxy materials, your shares may be registered in more than one name or in different accounts. Please follow the voting instructions on the proxy card in the proxy materials to ensure that all of your shares held by beneficial owners, please see the question titled “What are ‘broker non-votes’?”voted.

Can I revokechange my vote after submitting my proxy?

Yes. You can revoke your proxy and changeat any time before the final vote at the Annual Meeting. If you are the record holder of your vote priorshares, you may revoke your proxy in any one of the following ways:

If your shares are held by your broker or bank as a nominee or agent, you should follow the instructions provided by your broker or bank for changing your vote.

When are stockholder proposals and director nominations due for next year’s annual meeting?

Voting in personwith your proxy, your bank, broker, or other nominee may deliver a proxy card expressly indicating that it is NOT voting your shares; this indication that a bank, broker, or nominee is not voting your shares is referred to as a “broker non-vote.” Because banks, brokers and nominees are permitted to vote uninstructed shares on Proposal 2, broker non-votes will be counted for the purpose of determining the existence of a quorum at the Annual Meeting, (but attendance at the Annual Meetingbut will not by itself revoke a proxy); orcount for purposes of determining the number of votes cast on Proposal 1. You should instruct your broker to vote your shares in accordance with directions you provide.

PROPOSAL 1

ELECTION OF DIRECTORS

The Board has nominated the seven individuals listed below to stand for election to the Board for a one-year term ending at the annual meeting of stockholders in 2022 or until their successors, if any, are elected or appointed. The Company’s Certificate of Incorporation and Bylaws provide for the annual election of directors. Each director must receive the affirmative vote of a majority of the votes of the shares present, in person or represented by proxy, and entitled to vote is required to ratify the appointment of McGladrey LLP as the independent auditors of our financial statements for the fiscal year ending December 31, 2015.

What other matters might arise at the meeting?

At the date of this proxy statement, the Board does not know of any matterscast to be raised atelected (i.e., the Annual Meeting other than those referred to in this proxy statement. The Proxies named in the proxy card are authorized to vote in their discretion upon such other matters as may properly come before the meeting or any adjournment or postponement thereof.

What if I mark abstain on my proxy card for a proposal?

Abstentions marked on a proxy card will be treated as shares that are present and entitled to vote for purposes of determining whether a quorum is present and for purposes of voting on Proposal No. 2 and Proposal No. 3. Accordingly, abstentions marked on a proxy card with respect to Proposal No. 2 and Proposal No. 3, will have the same effect as votes against Proposal No. 2 and Proposal No. 3.

What are “broker non-votes”?

Under the rules of the New York Stock Exchange (“NYSE”), member brokers who hold shares in street name for their customers that are the beneficial owners of those shares have the authority to only vote on certain “routine” items in the event that they have not received instructions from beneficial owners. Under NYSE rules, when a proposal is not a “routine” matter and a member broker has not received voting instructions from the beneficial owner of the shares with respect to that proposal, the brokerage firm may not vote the shares on that proposal because it does not have discretionary authority to vote those shares on that matter. A “broker non-vote” is submitted when a broker returns a proxy card and indicates that, with respect to particular matters, it is not voting a specified number of shares on those matters, as it has not received voting instructions with respect to those shares from the beneficial owners and does not have discretionary authority to vote those shares on such matters. “Broker non-votes” are not entitled to vote at the Annual Meeting with respect to the matters to which they apply; however, “broker non-votes” will be included for purposes of determining whether a quorum is present at the Annual Meeting.

Proposal No. 1 and Proposal No. 2 are considered “non-routine” matters. As a result, brokers that do not receive instructions with respect to Proposal No. 1 and Proposal No. 2 from their customers will not be entitled to vote on such proposals, and any such “broker non-votes” will have no effect on the voting on such proposals. Proposal No. 3: Ratification of Auditors is considered a “routine” matter, and accordingly, brokers and other nominees will have discretionary authority to vote on that proposal.

The Board strongly encourages you to vote your shares and exercise your right to vote as a stockholder on each of the proposals.

Who can attend the Annual Meeting?

All stockholders of record as of July 2, 2015, or their duly appointed proxies, may attend. A list of stockholders entitled to vote at the Annual Meeting, arranged in alphabetical order, showing the address of and

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number of shares registered in the name of each stockholder, will be available for review starting no later than August 3, 2015, and continuing until the Annual Meeting, at our offices located at 101 Mittel Drive, Wood Dale, Illinois 60191. Please note that, if you hold shares in “street name” (that is, through a broker or other nominee), you will need to bring valid picture identification and evidence of your share ownership as of the record date, such as a copy of a brokerage statement. If you come to the Annual Meeting, you may, of course, vote in person. If you are a “street name” holder and wish to vote at the meeting, you must first obtain a proxy from your bank, broker or other holder of record authorizing you to vote.

How will the results of voting be published?

We will disclose voting results by filing a current report on Form 8-K with the SEC within four business days following the date of the Annual Meeting. If, on the date of filing that current report on Form 8-K, the inspector of elections for the Annual Meeting has not certified the voting results as final, we will indicate in the filing that the results are preliminary and publish the final results in a subsequent current report on Form 8-K, which we will file within four business days after the final voting results are known.

GOVERNANCE OF THE COMPANY

What principles has the Board established with respect to corporate governance?

The Board has carefully reviewed the corporate governance rules adopted by the Securities Exchange Commission (the “SEC”) and The NASDAQ Stock Market (“NASDAQ”) and other corporate governance recommendations. The Board adopted the corporate governance documents described below.

The full text of the Corporate Governance Guidelines, the Board Committee charters, our Code of Ethics for Principal and Senior Financial Officers, our Code of Business Conduct and Ethics and our Related Party Transaction Policy are available on our website atwww.psiengines.com in the “Corporate Governance” section. Our website also provides information on how to contact us and other items of interest to investors. We make available on our website, free of charge, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to these reports, as soon as practical after we file these reports with the SEC. In addition, we will describe on our website any amendments to, or waivers from, the provisions of our Code of Ethics for Principal and Senior Financial Officers.

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What is the composition of the Board?

The Board currently consists of five director seats, with each director serving until the next annual meeting of our stockholders and until his or her successor is duly elected and qualified.

On March 25, 2015, H. Samuel Greenawalt passed away. Mr. Greenawalt was a valued member of our Board and our Audit Committee. Since Mr. Greenawalt’s passing, the Board has been actively seeking a candidate to fill the open Board and Audit Committee seat. The Board is committed to finding a candidate that not only meets the applicable NASDAQ director and audit committee independence requirements, but has the necessary background and business acumen to provide a substantive contribution to our Board, the Company and its stockholders. Please refer to“How are nominees for the Board selected?” for further information.

The Board has nominated Gary S. Winemaster, Kenneth W. Landini, Jay J. Hansen and Mary E. Vogt for re-election to the Board at the Annual Meeting and is recommending that you elect each of Messrs. Winemaster, Landini and Hansen and Ms. Vogt for a one-year term (and until his or her successor is elected and qualified, or until the earlier resignation or removal of such director) at the Annual Meeting.

Which directors are independent and how does the Board make that determination?

As we are listed on The NASDAQ Capital Market, we are subject to the applicable independence requirements for directors of The NASDAQ Stock Market, and the corporate governance rules of NASDAQ require our Board to be composed of a majority of independent directors. Our Board has determined that Mr. Hansen and Ms. Vogt (and Mr. Greenawalt until his passing) meet the applicable independence requirements for directors of The NASDAQ Stock Market, and that Mr. Winemaster and Mr. Landini do not meet such standards. The Company has until September 21, 2015 to elect a new director who meets NASDAQ’s independence requirements.

We do not currently have a separately designated nominating committee. Therefore, in accordance with NASDAQ rules, a majority of our independent directors recommend each nominee for the Board’s consideration. Our board has determined that Mr. Hansen and Ms. Vogt meet the applicable independence requirements of The NASDAQ Stock Market for nominating committee members and compensation committee members, and has determined that Mr. Winemaster and Mr. Landini do not meet such standards.

In addition to the NASDAQ independence requirements, we also apply the independence guidelines set forth in our Corporate Governance Guidelines, which are available on our website atwww.psiengines.com in the “Corporate Governance” section and are substantially similar to the NASDAQ director independence requirements.

Do independent directors meet separately in regularly scheduled executive sessions?

Yes. The independent directors meet, without the presence of any director who is not independent, for a session at each regularly scheduled Board meeting and at various other times throughout the year if deemed necessary.

How can I communicate with directors?

As set forth in our Corporate Governance Guidelines, stockholders or other interested parties may communicate with the Board, or any individual member or members of the Board, by sending a letter to Power Solutions International, Inc. Board, c/o the General Counsel, Power Solutions International, Inc., 201 Mittel Drive, Wood Dale, IL 60191. The General Counsel will receive the correspondence and forward it to the Board or specified Board member or members to whom the communication is addressed.

How often did the Board meet in fiscal 2014?

During fiscal 2014, the Board met two times. During fiscal 2014, each director who served on the Board during fiscal 2014 attended at least 75% of the aggregate of (1) the total number of meetings held by the Board during the period in which such individual wasvoted “FOR” a director and (2) the total number of meetings held by all committees of the Board on which he served during the period in which such individual served on such committees.

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What is the Company’s policy regarding Board members’ attendance at the Annual Meeting?

The Corporate Governance Guidelines provide that directors are expected to attend the Annual Meeting. The full text of the Corporate Governance Guidelines is available on our website atwww.psiengines.com in the “Corporate Governance” section. All of our Board members who served on the Board at the time of our 2014 annual meeting of stockholders attended that meeting.

What is the Board’s leadership structure, and why is it the best structure for the Company at this time?

Gary S. Winemaster currently serves as both our Chief Executive Officer (“CEO”) and our Chairman of the Board (“Chairman”). Under our Corporate Governance Guidelines, the Board has the flexibility to determine whether or not to separate the roles based on circumstances which exist from time to time. Although separation of the roles is not required, the Board may determine it is appropriate under certain circumstances. At this time, the Board believes that having one individual serve as both Chairman and CEO is the best governance model for the Company. Due to the varied and complex nature of the Company’s business, the Board believes the CEO is in the best position to lead most effectively and to serve in the critical role of Chairman. Having a Chairman who also serves as CEO facilitates timely communication with other directors on critical business matters. The Board believes that leadership of both the Board and the Company by Mr. Winemaster is the optimal structure to guide the Company and maintain the focus needed to achieve our business goals. The Board also believes there is an effective balance between strong Company leadership and appropriate oversight by independent directors.

Because Mr. Winemaster serves as both our Chairman and as our CEO, the non-management directors have designated Kenneth W. Landini, who is neither an officer nor an employee of the Company, to serve as “Lead Outside Director.” Although the Board has determined that Mr. Landini does not meet the applicable independence requirements of NASDAQ, the Board believes that, given his long history with, and deep knowledge of, the Company and its management, and in light of the Company’s, relatively recent listing on The NASDAQ Capital Market, Mr. Landini continues to be the best candidate to serve as the Company’s Lead Outside Director at this time. As Lead Outside Director, Mr. Landini is responsible for (i) presiding at all meetings of the Board at which the Chairman of the Board is not present, including executive sessions of non-management directors, (ii) serving as a liaison between the Chairman of the Board and the non-management directors, (iii) approving information sent to the Board as a whole, (iv) calling meetings of non-management directors, (v) approving meeting agendas for the Board, (vi) approving meeting schedules for the Board and, (vii) if requested by significant stockholders of the Company, being available for consultation and direct communication with such stockholders (subject to compliance with applicable Company policies).

What is the Board’s role in risk oversight?

From time to time, we are exposed to risks, including strategic, operational, financial, legal, regulatory and compliance risks. The Board as a whole, as well as the committees thereof, are responsible for overseeing our risk management process and evaluating whether this process, as designed, is adequate to effectively manage the risks that we face. Our management is responsible for developing and implementing the Company’s plans and processes for risk management and is responsible for preparing and delivering reports directly to the Audit Committee and the Board with respect to risk management.

Throughout the year, the Board and the committees to which it has delegated responsibility will conduct risk assessments and discuss identified risk and how to eliminate or mitigate such risks, within such areas as operational, financial performance, financial reporting, legal, regulatory and strategic. The Board will review with management its plans and processes for managing risk. In addition, while our Board is ultimately responsible for overseeing our risk management, the committees of our Board will assist the Board in fulfilling this responsibility by evaluating and assessing risks within their respective areas of responsibility and advising the Board of any significant risks.

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For example, the Audit Committee focuses on assessing and mitigating financial reporting risks, including risks related to internal control over financial reporting. The Compensation Committee considers risks relating to the Company’s compensation programs and policies, and evaluates whether our compensation programs are designed so employees are incentivized to make decisions that lead to long-term value for our stockholders, without encouraging excessive risk-taking.

What are the committees of the Board and what are their functions?

The Board has established two standing committees: an Audit Committee and a Compensation Committee. Each of these committees consists of only non-employee directors. The current members of the committees are identified in the table below.

Audit Committee

The current members of our Audit Committee are Mr. Hansen and Ms. Vogt, each of whom is “financially literate” as required by NASDAQ rules. Both Mr. Hansen and Ms. Vogt qualify as “audit committee financial experts” as defined in SEC rules under the Sarbanes-Oxley Act of 2002. Our Board has determined that each of Mr. Hansen and Ms. Vogt meets the independence requirements of NASDAQ for audit committee members. The Audit Committee exercises oversight responsibility regarding the quality and integrity of our accounting and financial reporting processes and the auditing of our financial statements. In fulfilling this responsibility, the Audit Committee, among other things, selects the independent auditors, pre-approves any audit or non-audit services to be provided by the independent auditors, reviews the results and scope of the annual audit performed by the auditors and assesses processes related to risks and the control environment. The Audit Committee reports to the full Board regarding all of the foregoing. The Audit Committee operates pursuant to a written charter that is posted on our website atwww.psiengines.comin the “Corporate Governance” section. The Audit Committee held seven meetings in fiscal 2014.

Compensation Committee

The current members of our Compensation Committee are Mr. Hansen and Ms. Vogt, each of whom meets the director independence requirements of NASDAQ. In affirmatively determining the independence of the Compensation Committee members, the Board considered certain specified factors set forth in NASDAQ’s rule on independence of compensation committee members. As further described in the Compensation Discussion and Analysis below, the Compensation Committee has the primary responsibility for reviewing and approving corporate goals and objectives relevant to executive compensation, evaluating executive performance, reviewing our executive policies and reporting and making recommendations to the full Board regarding executive compensation. The full Board makes all final determinations (other than with respect to equity awards) regarding executive compensation based upon the recommendations of the Compensation Committee. The Compensation Committee also has responsibility for administering the Power Solutions International, Inc. 2012 Incentive Compensation Plan, as amended on July 31, 2013 (the “2012 Plan”), determiningnominee must exceed the number of equity-based awards tovotes cast “AGAINST” that nominee). Unless contrary instructions are given, the shares represented by your proxy will be granted to our executive officers, non-employee directors and employees pursuant tovoted “FOR” the 2012 Plan, and reporting to the full Board regarding the foregoing matters. The Compensation Committee operates pursuant to a written charter that is posted on our website atwww.psiengines.comin the “Corporate Governance” section. The Compensation Committee held three meetings in fiscal 2014.

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Pursuant to its charter, the Compensation Committee has the authority to retain, as needed, any independent counsel, compensation and benefits consultants and other outside experts or advisors as the Compensation Committee believes to be necessary or appropriate. The Compensation Committee has not historically used compensation consultants in determining executive compensation; however, in 2013 and 2014, the Compensation Committee engaged the firmelection of The Delves Group, which was subsequently acquired by Towers Watson & Co. (the “Compensation Consultant”), as an independent compensation consultant to report and advise on certain matters related to executive compensation, including matters relating to the 2012 Plan and equity awards under the 2012 Plan. The Compensation Committee assessed the independence of the Compensation Consultant pursuant to the SEC’s and NASDAQ’s rules and concluded that the work the Compensation Consultant has performed, and will perform, does not raise any conflict of interest. The Compensation Committee anticipates regularly calling upon the Compensation Consultant, as appropriate, to attend Compensation Committee meetings, meet with the Compensation Committee without management present and provide third-party data, advice and expertise on proposed executive compensation levels, programs and plan designs.

How are nominees for the Board selected?

We do not have a standing nominating committee. The Board does not believe that it is necessary for us to have a standing nominating committee because we have a relatively small Board and our independent directors serve in the capacity of a nominating committee when necessary. Because we do not currently have a standing nominating committee, our full Board participates in the consideration ofall director nominees. However, consistent with applicable NASDAQ corporate governance rules, each directorIf any nominee will be recommended for the Board’s selection by a majority of the independent directors of the Board after consultation with our Chief Executive Officer.

The Board considers many factors when evaluating candidatesbecomes unavailable for election to the Board, including that the proper skills, experiences and competencies are represented on the Board and its committees and that the composition of the Board and each such committee satisfies applicable legal requirements. Among other criteria, the Board considers a candidate’s independence; ability to exercise business judgment; applicable industry knowledge and experience, other relevant business or professional experience and the ability to offer our management meaningful advice and guidance based on that experience; as well as core competencies or technical expertise necessary for our committees. Additionally, while the Board does not have a formal policy mandating the consideration of diversity in identifying or evaluating director nominees, directors or the Board as a whole, under our Corporate Governance Guidelines, the Board considers factors such as diversity when evaluating directors, director candidates and the overall composition of the Board, with diversity being broadly understood by the Board to mean a variety of opinions, perspectives, personal and professional experiences and backgrounds, including gender, race and ethnicity differences, as well as other differentiating characteristics. The director qualification standards that the Board uses when considering candidates are included in the Corporate Governance Guidelines available on our website atwww.psiengines.com in the “Corporate Governance” section. The Board considers the entirety of each candidate’s credentials and does not have any specific minimum qualifications that must be met by a nominee. However, the Board does believe that all members of the Board should have the highest personal and professional ethics, a commitment to representing the long-term interests of the stockholders and sufficient time to devote to Board matters.

The Board considers candidates for the Board from any reasonable source, including stockholder recommendations and recommendations from current directors and executive officers. The Board does not evaluate candidates differently based on who has proposed the candidate. After considering candidates and assessing any material relationships with the Company or third parties that might adversely impact independence and objectivity, as well as such other criteria as the Board determines to be relevant at the time, the Board determines which candidates to nominate.

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How can a stockholder recommend a candidate for nomination as a director of Power Solutions International, Inc.?

Stockholders who wish to nominate a qualified director candidate should write to us at our principal executive offices. The procedures to submit stockholder proposals and candidates for nomination for director to the Board for the 2016 annual meeting of stockholders are described under the section entitled “Miscellaneous and Other matters – Deadlines for Submission of Proxy Proposals of Stockholders and Stockholders Nominations of Directors.”

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PROPOSAL NO. 1

ELECTION OF DIRECTORS

The Board currently consists of four (4) directors. Article Fifth of our Certificate of Incorporation provides that the business and affairs of the Company shall be managed by, or under the direction of, a board of directors consisting of no less than five (5) and no more than eleven (11) directors. The size of the Board is currently set at five members. Each director holds office for a one-year term until the next annual meeting of stockholders and until his or her successor shall be elected and qualified, subject, however, to prior death, resignation, retirement or removal from office.

On March 25, 2015, H. Samuel Greenawalt, a director and member of the Audit Committee, passed away. Mr. Greenawalt provided many years of service through his financial background and general business expertise. The Board recognizes the loss of Mr. Greenawalt’s knowledge and leadership. As a result of Mr. Greenawalt’s death, our current Board is comprisedan unexpected occurrence, your shares will be voted for the election of four (4) members. We are ina substitute nominee proposed by the process of searching and identifying appropriate candidates to fill the vacancy. In addition, in compliance with NASDAQ Listing Requirements, any candidate must have the necessary credentialsCompany. Each person nominated for election has agreed to serve on the Audit Committee and such candidate must be independent under applicable NASDAQ requirements. We have until September 21, 2015 to comply with such NASDAQ Listing Requirements.

At the Annual Meeting, each of Messrs, Winemaster, Landini and Hansen and Ms. Vogt is nominated to be elected for a term of one year expiring at the 2016 Annual Meeting of Stockholders and until his or her successor is elected and qualified.

THE BOARD RECOMMENDS THAT THE STOCKHOLDERS VOTE “FOR” THE ELECTION OF EACH OF THE NOMINEES NAMED IN THIS PROXY STATEMENT TO SERVE AS A DIRECTOR FOR A ONE-YEAR TERM.

If at the time of the Annual Meeting a nominee should be unable or declines to serve, the person named in the proxy will vote for such substitute nominee as the Board recommends, or vote to allow the vacancy created thereby to remain open until filled by the Board, as the Board recommends.if elected. The BoardCompany’s management has no reason to believe that any nominee for election at the Annual Meeting will be unable or will decline to serve as a director if elected.serve.

The following table listsand biographical summaries set forth, with respect to each nominee for director, his committee membership, his age, the nominees for electionyear in which he first became a director of the Company, and whether or not Weichai America Corp., a wholly owned subsidiary of Weichai Power Co., Ltd. (herein collectively referred to as “Weichai”) designated such director to serve on the Board pursuant to the Board, their ages, their positions withInvestor Rights Agreement, entered into by the Company and Weichai (as discussed in the year each was first elected as a director and the expiration of their current terms.“Related Person Transactions” section in this proxy statement):

December 2002 and Executive President since October 2007 of Weichai Power Co., Ltd., a publicly traded company on the reverse recapitalization, Mr. Winemaster was also appointedHong Kong Stock Exchange and the Shenzhen Stock Exchange and leading global designer and manufacturer of diesel engines (“Weichai Power”), as thewell as Chairman of Shandong Weichai Import and Export Co., Ltd., a wholesale distributor of industrial machinery and equipment. On January 1, 2019, Dr. Sun was appointed a Director of Ballard Power Systems Inc., a publicly-traded company on the Board. Mr. Winemaster is a co-founder of our CompanyNASDAQ Stock Market (“NASDAQ”) and has played a significant roleToronto Stock Exchanges that builds fuel cell products. Dr. Sun joined Weifang Diesel Engine Factory in developing1988 and expanding our presenceheld various supervisory positions as a distributorChief Engineer of alternative fuel spark-ignitedWeifang Diesel Engine Factory, and diesel power systems. Prior to serving in his role as Chief Executive Officer and PresidentDirector of our company and of Power Great Lakes, Mr. Winemaster served as the Vice President of Sales for Power Great Lakes. Prior to founding our company, Mr. Winemaster worked in sales management for the European operations, with territory responsibility for the German, Scandinavian and Benelux markets, of Guardian Industries, a United States glass manufacturer. Mr. WinemasterTorch Automobile Group Co., Ltd.

Dr. Sun holds a Bachelor of ScienceMaster’s degree from Beihang University and a Doctorate degree in Engineering from Tianjin University. Dr. Sun serves on the Wharton School at the University of Pennsylvania.

Our Board believes that Mr. Winemaster, as our Chief Executive Officer and President and as a co-founder of our Company, should serve as a director because of Weichai designee.

Dr. Sun brings to the Board extensive managerial experience and leadership gained through his executive roles at leading engine manufacturers.

Biography: Mr. Winemaster’s unique understanding of the opportunities and challenges that we face and his in-depth knowledge about our business, including our customers, products, operations and key business drivers, and our long-term growth strategies, derived from his long service as our Chief Executive Officer and President.

Kenneth LandiniHe has served as a Director of the Company since November 14, 2019. Mr. He is a member of the Audit and Compensation Committees.

Mr. He has served as Associate Director, Financial Planning & Analysis for CytomX Therapeutics (“CytomX”), a NASDAQ-listed biotechnology company, since February 2021, and previously served as a Consultant to CytomX beginning in February 2020. Previously, Mr. He served as Director of Finance and Reporting for Blackthorn Therapeutics, a clinical-stage biotechnology company, from June 2019 to December 2019. Prior to that, Mr. He served as the Head of Finance at GenapSys, Inc. from 2018 until May 2019. From 2014 until 2018, Mr. He was the finance director of SciClone Pharmaceuticals, Inc., a NASDAQ-listed specialty pharmaceutical company with main operations in China. From January 2014 to June 2014, Mr. He served as Vice President of Finance and the Controller of Augmedix, Inc., a privately held technology-enabled medical documentation company. From October 2011 to December 2013, Mr. He was employed as Vice President of Finance at Baidu Leho.com, a private company backed by Baidu, a NASDAQ-listed company.

Mr. He earned his Bachelors of Science degree in Accounting from Beijing University of Technology in July 1992 and his Masters of Business Administration degree from University of Chicago Booth School of Business in December 2006. Mr. He is a U.S. certified management accountant and a China certified public accountant. Mr. He qualifies as an “audit committee financial expert” under applicable SEC regulations and has substantial public company reporting experience gained from his roles as a financial officer and controller of public companies during his career.

Mr. He brings to the Board substantial financial and managerial experience gained through leadership roles at public companies.

Biography: Mr. Landini has served as a Director of the Company since 2001 and assisted in the development and growth of the business of our companythe Company since 1985. Mr. Landini is a member of the Audit Committee. From August 7, 2017 to January 19, 2021, Mr. Landini was the Chair of the Compensation Committee. He also served as a member of the Nominating Committee from April 2017 to January 19, 2021.

Mr. Landini previously served as the Vice President of Finance for ourthe Company’s subsidiary, Power Great Lakes, Inc., from December 1985 to March 1988 and assisted usthe Company in establishing distributor relationships and expanding the territories into which we provide ourthe Company provides its power systems. Mr. Landini is a partnerPartner and co-founderCo-founder of Landini, Reed & Dawson, P.C., a certified public accounting and consulting firm in southeastern Michigan, which was established in 1988. Mr. Landini has served as a certified public accountant for Landini, Reed & Dawson, P.C. since its inception. Mr. Landini

He holds a Bachelor of Arts degree from Albion College and is a licensed certified public accountantCertified Public Accountant in the state of Michigan.

Our Board believes that Mr. Landini should servequalifies as an “audit committee financial expert” under applicable SEC regulations and has substantial audit experience gained from his tenure as a director becausepartner at a certified public accounting and consulting firm.

Mr. Landini brings to the Board an in-depth knowledge and understanding of his significant knowledge of our industry, his prior experience with ourthe Company’s business and his financial expertise.operations, having served as Vice President of Finance for one of the Company’s subsidiaries.

Jay Hansen

Biography: Mr. Li has served as a Director of the Company since December 2020. Since January 19, 2021, he has been the Chair of the Nominating Committee.

Mr. Li is currently General Counsel and Head of Legal Affairs and Compliance Department of Weichai Power, a publicly traded company on the Hong Kong Stock Exchange and the Shenzhen Stock Exchange, and General Counsel and Head of Legal Affairs and Compliance Department of the Weichai Group. He has held both positions since January 2020. Previously, Mr. Li held the position of Secretary of the Board of Directors of Ferretti S.p.A., a multinational yacht building company from August 2015 to December 2019. He was also the Secretary of the Board of Directors of Ferretti International Holdings S.p.A., the parent company of Ferretti S.p.A., from August 2015 to December 2019. Mr. Li has been serving as a director of Ferretti International Holding S.P.A. and Ferretti S.P.A. since 2011.April 4, 2020. Also, he was appointed as the Chairman of the supervisory board of Weichai Lovol Heavy Industries Co. Ltd. on January 3, 2021 and was appointed as a supervisor of Hengtian Kama Co., Ltd., a publicly traded company on the Shanghai Stock Exchange, on January 9, 2021. He has experience assisting boards of directors and executive officers in significant merger and acquisition and initial public offerings projects. Mr. Hansen isLi also has experience in coordinating between boards of directors and shareholders.

He holds a Bachelor’s degree in Law from the co-founderLaw School of O2 Investment Partners, LLC,China University of Political Science and Law. Mr. Li also has a private equity investment group focusingMaster’s degree in Law from the Law School of Central University for Nationalities. Mr. Li serves on smallthe Board as a Weichai designee.

Mr. Li brings to the Board skills, experience and middle market manufacturing, niche distribution, select servicequalifications in business and technologycorporate law, his legal expertise and his familiarity with the construction machinery and engine businesses and.

Biography: Mr. Simpkins has served as a Director of the PresidentCompany since July 13, 2017. Since January 19, 2021, he has been the Chair of the Audit Committee. Mr. Simpkins is also a member of the Nominating Committee.

Mr. Simpkins has over 25 years of executive management and Managing Partner of O2 Investment Partners, LLC since 2010. Priorfinancial experience. From June 2016 to forming O2 Investment Partners, LLC, Mr. Hansen provided consulting services in the financial and manufacturing industries. From May 2003 through February 2006, Mr. HansenDecember 2016, he served as Chief Financial Officer of Emerson Network Power, part of Emerson Electric Co.,

a publicly-traded company on the New York Stock Exchange (the “NYSE”). From 2006 to 2015, Mr. Simpkins served as Vice President and Chief Financial Officer and in 2006 he served as the Chief Operating Officer, of Noble International, Ltd.Kennametal Inc., a publicly traded supplierpublicly-traded company on the NYSE and a global leader in the design and manufacture of automotive parts, component assembliesengineered components, advanced materials and value-added servicescutting tools. Prior to that role, Mr. Simpkins held various positions within Kennametal since 1995. Prior to Kennametal, he worked as a Manager for PricewaterhouseCoopers from 1986 to 1995. Mr. Simpkins serves on the automotive industry. Mr. HansenBoard of Trustees at Seton Hill University, Greensburg and previously served on the Board of Trustees of Pennsylvania State University, New Kensington.

He holds a Bachelor of Science degree in EconomicsAccounting from Pennsylvania State University. Mr. Simpkins qualifies as an “audit committee financial expert” under applicable SEC regulations and has substantial public-company reporting experience gained from his roles as Chief Financial Officer during his career.

Mr. Simpkins brings to the Wharton School at the University of Pennsylvania. Since 2005,Board significant management experience, as well as his experience as a Chief Financial Officer.

Biography: Mr. HansenShao has served as a memberDirector of the board of directors,Company since 2020.

Mr. Shao is the President and as the chairmanChairman of the audit committee,Board of Directors of Weichai America Corp. (“Weichai America”), which focuses on researching, developing and manufacturing a full line of off-road natural gas engines and engine components. Weichai America is a wholly owned subsidiary of Weichai Power Co., Ltd., a publicly traded company on the Hong Kong Stock Exchange and the Shenzhen Stock Exchange. From May 2012 to April 2018, Mr. Shao was President of Weichai Westport Inc., a joint venture between Weichai Power and Westport Fuel Systems Inc., a publicly traded company on the NASDAQ and Toronto Stock Exchanges, that manufactures and sells alternative-fuel engines for automobiles, heavy-duty trucks, power generation and shipping applications.

He has a Bachelor’s degree in Industrial Energy and Power Engineering from Shandong University. Mr. Shao also holds a Master’s degree in Power Engineering from Tianjin University and a Masters of Business Administration degree from Missouri State University. Mr. Shao serves on the Board as a member ofWeichai designee.

Mr. Shao brings to the Compliance and Risk Committee of Flagstar Bancorp, a publicly held savings and loan holding company.Board in-depth executive leadership experience in manufacturing engines.

Our Board believes that

Biography: Mr. Hansen should serve as a director because of his experience on the board of directors of another public company, which our Board believes is beneficial to us as we continue to move forward as a public company, as well as Mr. Hansen’s significant knowledge of our industry and relevant business and financial expertise, which is important as our Board exercises its oversight responsibility regarding the quality and integrity of our accounting and financial reporting processes and the auditing of our financial statements.

Mary VogtWu has served as a directorDirector of the Company since 2011. Ms. VogtAugust 20, 2019. Since January 19, 2021, he has been the Chair of the Compensation Committee.

Since February 2021, Mr. Wu has served as the President of Home Access Health Corporation,in a medical device manufacturerfinance planning and specialty laboratory serving the disease management, wellness, managed care and consumer markets with its suite of laboratory self-testing products, since 2008, andanalysis role at Beijing Bytedance Network Technology Co., Ltd. Prior to that, Mr. Wu served as the Chief Financial Officer, International Business of Home AccessWeichai Group, an affiliate of Weichai America, from 2014 to January 2021. Mr. Wu joined Weichai Group in 2012 and previously served as Senior Manager, International Business. Prior to joining Weichai Group, Mr. Wu was employed at PricewaterhouseCoopers in various roles of increasing seniority from 2003 until 2012.

Mr. Wu earned a Bachelor’s degree in International Business in July 2000 and a Master’s degree in Management in March 2003 from School of Management, University of Science and Technology Beijing, China. Mr. Wu serves on the Board as a Weichai designee.

Mr. Wu brings to 2008. From 1999 to 2003, Ms. Vogt served

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as an independent consultant assisting businessesthe Board substantial experience from leadership positions in the manufacturing and e-commerce industries. Ms. Vogt also served, from 1995 to 1998, as the worldwide director of internal audit for the Leo Burnett Company, a full-service, multi-national advertising and marketing firm, and, from 1992 to 1995, as the Treasurer for Harley-Davidson Financial Services, a subsidiary of Harley-Davidson, Inc. and provider of wholesale and retail financing and insurance and insurance-related programs primarily to Harley-Davidson dealers and their retail customers. Ms. Vogt holds a degree in Economics and Management from Albion College.industrial engine sector.

Our Board believes that Ms. Vogt should serve as a director because of her relevant business experience and knowledge of our industry, as well as her financial expertise, which is important as our Board exercises its oversight responsibility regarding the quality and integrity of our accounting and financial reporting processes and the auditing of our financial statements.THE BOARD UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH OF THE DIRECTOR NOMINEES NAMED IN THIS PROXY STATEMENT.

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EXECUTIVE OFFICERS

The following table sets forth certain information regardingwith respect to the Company’s executive officers as of the Company. Information pertaining to Mr. Winemaster, who is both a director and the President and Chief Executive Officer of the Company, may be found in the “Nominees” section of Proposal No. 1 above.May 31, 2021.

Kenneth J. Winemaster joined the Company in December of 1985 and was a founder of the Company with his father Bill and brother Gary. He was appointed as Executive Vice President on November 28, 2017. Mr. Winemaster served as the Company’s Senior Vice President sincefrom 2001 to 2017 and also served as the Company’s Secretary from 2001 to July 23, 2013. In addition, Mr. Winemaster served as a director of the Company from 2001 through November 21,to 2011. He has served on the Board of Directors of Avon Old Farms School, an independent boarding school in Connecticut, since 2014. He served on the Caterpillar Industrial Strategy Council from 2001 to 2015, a council that developed market strategy for Perkins Distributors and CAT Dealers in North America. Mr. Winemaster has primary responsibility for our relationshipssignificant management experience setting strategy and supporting operations, with Caterpillarsupply chain and Perkins.customer service.

Prior to joining the Company, Mr. Winemaster has expertise in raw material procurement, assemblyattended Michigan State University.

Jason C. Lin was appointed as the Chief Quality Officer on March 15, 2021 after serving as Chief Technical Officer since June 2019. His role as Chief Quality Officer includes the oversight of the Company’s Total Quality System, including setting up corporate wide quality structure, processes and shipping.

Eric Cohen hasorganizations, including the central quality group and each related functional area; building close loop measures and continuously improving processes with selected tools, and reducing warranty expenses and increasing customer satisfaction. Mr. Lin served as our Chief Operating Officer since April 2012.a member of the Company’s Board from May 2017 until June 2019. From January 2011 through March 2012,2009 to July 2016, Mr. CohenLin served as theChief Executive Officer and President of Société Internationale des Moteurs Baudouin, a France-based marine engine manufacturing subsidiary of Weichai Power Plant Services,Co., Ltd., a publicly traded company on the Hong Kong Stock Exchange and the Shenzhen Stock Exchange. During this tenure, he also served as an Executive Technical Director and adviser to the Chairman of Weichai Power Co., Ltd. From February 2001 to July 2006, Mr. Lin was employed by International Truck and Engine Corporation, a truck, bus and diesel engine manufacturer subsidiary of standardNYSE-listed Navistar International Corporation, in engineering management positions. Earlier in his career, Mr. Lin was employed in engineering positions by Cummins Engine Company, a NYSE-listed company and custom aftermarket partsworked in Japan for turbines, generators, valvesKomatsu-Cummins Engine Company as Vice President.

Mr. Lin received his Bachelor of Science degree and coal handling equipment. From 2004 through 2010, Mr. Cohen was a managing partnerMaster of WHI Capital Partners, a Chicago-based private equity firm that investsScience degree in mid-size companies. Mr. Cohen earned a mechanical engineeringMechanical Engineering from National Cheng Kung University in Taiwan, and his Master of Science degree and PhD. in Mechanical Engineering from the University of Wisconsin—Madison.

C. (Dino) Xykiswas appointed as the Chief Technical Officer on March 15, 2021. Mr. Xykis is responsible for the oversight of the Company’s advanced product development, engineering design and an MBA from Harvard Business School.analysis, on-highway

Daniel Gorey has engineering, applied engineering, emissions and certification, Waterford, Michigan engineering operations, program management and product strategic planning. Since joining the Company in 2010 and until his appointment as Chief Technical Officer in March 2021, Mr. Xykis served as our Chief Financial Officer since April, 2012, and served as our Senior Vice President of Finance from July 2011 to March 2012. From March 2010 until he joinedEngineering for the Company. He has more than 30 years of professional experience in multi-disciplined engineering areas including senior management and executive positions at various companies including Cummins Inc., an NYSE-listed company, and Generac Power Systems, an NYSE-listed company. Mr. Gorey was an independent financial consultant. Prior to that, Mr. GoreyXykis also served as Adjunct Professor of Mechanical Engineering and Mechanics at the Chief Financial OfficerMilwaukee School of Engineering and waspreviously served on the audit and compensation committees of the Board of Directors of Image Sensing Systems, a publicly traded company on NASDAQ, from 1996 to 2001. Mr. Xykis has also served on the advisory board of directors of Quixote Corporation, a publicly-traded provider of highway crash safety systems. Mr. Gorey joined Quixote Corporation in 1985, and served as its chief financial officer from 1995 until February 2010. Mr. Gorey also serves on the board of directors of American Roller Company, a privately-held manufacturer of industrial rollers. Mr. Gorey earned a BachelorCEGE, College of Science and Engineering, University of Minnesota for the past eight years.

Mr. Xykis holds a Bachelor’s degree in AccountingStructural Engineering, a Master’s degree in Vibration/Dynamics, and a PhD. in Structural/Applied Mechanics from the University of IllinoisMinnesota, Minneapolis.

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

Director Independence and Controlled Company Exemption

While the Company’s Common Stock is currently traded on the OTCPink market, which requires the Company to establish and maintain fundamental corporate governance standards, the Company has elected to adopt more exacting governance standards that are substantially similar to the NASDAQ listing governance standards. The Board has determined that the Company is a certified“controlled company,” as defined in Rule 5615(c)(1) of the NASDAQ Marketplace Rules. The Board has based this determination on the fact that Weichai currently owns a majority of the Company’s Common Stock. Under the NASDAQ rules, a company where more than 50% of the voting power for the election of directors is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain NASDAQ corporate governance requirements, including:

The Company is not currently relying on the controlled company exemption for the above requirements, but may in the future.

Unless the Company avails itself of the “controlled company” status as discussed above, pursuant to NASDAQ listing standards, a majority of the members of the Board must qualify as “independent,” as affirmatively determined by the Board. In addition to the NASDAQ independence requirements, the Company also applies the independence guidelines set forth in its Corporate Governance Guidelines, which are available on the Company’s website at www.psiengines.com in the “Investors” section, under “Governance” which are substantially similar to the NASDAQ’s director independence requirements and “controlled company” exemptions. Consistent with this requirement, based on the review and recommendation of the Company’s Nominating Committee, the Board reviewed all relevant identified transactions or relationships between each of the Company’s directors, or any of their family members, and PSI, the Company’s senior management and the Company’s independent registered public accountant.accounting firm, and has affirmatively determined that each of Dr. Sun, Messrs. He, Landini, Li, Simpkins and Wu and each former director Mr. Jiang and Ms. Coolidge meets the standards of independence under the applicable NASDAQ listing standards. In making this determination, the Board found Dr. Sun, Messrs. He, Li, Landini, Simpkins and Wu and former directors Mr. Jiang and Ms. Coolidge to be free of any relationship that would impair his or her individual exercise of independent judgment with regard to the Company. The Board determined Mr. Shao is not independent due to his position as an executive officer of an affiliate of the Company. The Board has also determined that each member of its Audit Committee is independent under NASDAQ Rule 5605(a)(2).

Family RelationshipsBoard Leadership Structure

Gary Winemaster, ourThe Board is led by an independent Chairman, Dr. Sun. The Company believes that such leadership structure is appropriate in light of the differences between the roles of Chairman and Chief Executive Officer. The Chief Executive Officer is responsible for setting the strategic direction of the Company and for day-to-day leadership and performance. The Chairman has the authority, among other things, to call and preside over Board meetings, to set meeting agendas and to determine materials to be distributed to the Board. Accordingly, the Chairman has substantial ability to shape the work of the Board. The Board recognizes that other leadership structures could be appropriate depending on the circumstances and, therefore, regularly re-evaluates this structure.

Role of the Board in Risk Oversight

The Board and its committees have an advisory role in risk oversight for the Company. Company management maintains primary responsibility for the risk management of the Company, however, the Audit Committee and the Board review a risk assessment of the Company on a regular basis. While it is not possible to identify and

mitigate all potential risks, the Board relies on the representations of management and the external audit of the financial statements to provide comfort on the Company’s ability to manage its risks. Management’s discussion of current risk factors is set forth in the Company’s Annual Report.

Meetings of the Board

PSI’s business, property and affairs are managed under the direction of the Board. Members of the Board are kept informed of PSI’s business through discussions with PSI’s Chief Executive Officer and other officers and employees, by reviewing materials provided to them during visits to the Company’s offices and by participating in meetings of the Board and its committees.

The Board held a total of six meetings in 2020. The standing committees of the Board are the Audit Committee, the Compensation Committee and the Nominating Committee. During 2020, the Audit Committee held eight meetings, the Compensation Committee held six meetings, and the Nominating Committee held three meetings. The charter for each of the standing Board committees is posted on the Company’s website at www.psiengines.com under “Investors” and then “Governance.” All directors attended 75% or more of the combined total number of meetings of the Board and the Board committees on which they served during 2020.

All of the members of the Board attended the annual meeting of stockholders on December 15, 2020 (the “2020 Annual Meeting”).

The following table provides membership for each of the Board committees as of May 31, 2021:

Committees of the Board

Below is a description of each committee of the Board.

Audit Committee

The Company has a separately designated Audit Committee. Each member of the Audit Committee is financially literate and the Board has determined that each of Mr. Simpkins, the chair of the Audit Committee, and Messrs. He and Landini each qualify as an “audit committee financial expert” as defined in applicable SEC rules because he, as applicable, meets the requirement for past employment experience in finance or accounting, and requisite professional certification in accounting or comparable experience. The Board has determined that each of Messrs. Simpkins, He and Landini meets the independence requirements for audit committee members under the NASDAQ rules and therefore, the Audit Committee is composed entirely of independent directors. The responsibilities of the Audit Committee include:

Compensation Committee

The Compensation Committee is responsible for overseeing matters relating to compensation of PSI’s Chief Executive Officer and other executive officers and employees, including the administration of incentive-based and equity-based compensation plans. The Board has determined that each of Dr. Sun, Mr. He and Mr. Wu meets the independence requirements for compensation committee members under the NASDAQ rules and therefore,

the Compensation Committee is composed entirely of independent directors. The responsibilities of the Compensation Committee include:

Nominating Committee

The Nominating Committee is responsible for overseeing the selection of persons to be nominated to serve on the Board and to assist the Board in developing and ensuring compliance with the Company’s foundational and corporate governance documents. The Nominating Committee is composed entirely of independent directors. The responsibilities of the Nominating Committee include:

Director Nominations

The Board has delegated to the Nominating Committee the responsibility of identifying, screening and recommending candidates to the Board. The Nominating Committee considers, without limitation, a potential candidate’s independence, skills, qualifications, qualities and other expertise required to be a director (the “Director Criteria”). Although the Nominating Committee does not have a formal policy regarding diversity in making its recommendations, in considering the Director Criteria, the Nominating Committee seeks to have a Board that reflects diversity in background, education, business experience, gender, race, ethnicity, culture, skills, business relationships and associations and other factors that will contribute to the Board’s governance of the Company, and reviews its diversity when assessing the composition of the Board. These qualifications may vary from year to year depending on the needs of the Company at the time.

The Director Criteria should not be construed as minimum qualifications for director selection nor is it expected that potential candidates will possess all of the Director Criteria identified. Rather, they represent the range of complementary talents, backgrounds and experiences that the Nominating Committee believes would contribute to the effective functioning of the Board.

The Company’s Corporate Governance Guidelines and Nominating Committee charter provide guidelines with respect to the consideration of director candidates. Under these guidelines, the Nominating Committee is responsible for, subject to approval by the Board, establishing and periodically reviewing the Director Criteria and selection of new directors, including independence standards. The Nominating Committee also may recommend to the Board changes to the portfolio of Director Criteria required for the effective functioning of the Board, considering PSI’s strategy and the regulatory, geographic and market environments.

The Nominating Committee will consider candidates proposed by stockholders to be potential director nominees. Stockholders wishing to nominate a candidate for consideration by the Nominating Committee as a director nominee should provide the name of any recommended candidate, together with a brief biographical sketch, a document indicating the candidate’s willingness to serve, if elected, and evidence of the nominating stockholder’s ownership of Company stock to the attention of the Company’s Chief Executive Officer at 201 Mittel Drive, Wood Dale, Illinois 60191, and otherwise follow the Company’s nominating process described in the Company’s Bylaws. The Nominating Committee’s policy is to evaluate director nominees proposed by stockholders in the same manner that all other director nominees are evaluated. The Company may, in the future, pay a third-party a fee to assist it in the process of identifying and/or evaluating director candidates.

Stockholder Communications with the Board

Stockholders who wish to communicate with the Board or an individual director may send a written communication to the Board or such director addressed to the Company’s Chief Executive Officer at 201 Mittel Drive, Wood Dale, Illinois 60191. Each communication must set forth:

Each communication will be reviewed by the Company’s Chief Executive Officer to determine whether it is appropriate for presentation to the Board or such director. Examples of inappropriate communications include advertisements, solicitations or hostile communications. Communications determined by PSI’s Chief Executive Officer to be appropriate for presentation to the Board or such director will be submitted to the Chairman of the Board, the Board or such director on a periodic basis.

Code of Business Conduct and Ethics

The Company has adopted a code of business conduct and ethics that applies to all of PSI’s employees, officers and directors, including those officers responsible for financial reporting. The code of ethics is available on the Company’s website at www.psiengines.com under “Investors” and then “Governance.”

Delinquent Section 16(a) Reports

Section 16(a) of the Exchange Act requires our directors and executive officers, and persons who own more than ten percent of a registered class of our equity securities, to file with the SEC initial reports of ownership and reports of changes in ownership of our Common Stock and other equity securities. Officers, directors and greater than ten percent stockholders are required by SEC regulation to furnish PSI with copies of all Section 16(a) forms they file.

To the Company’s knowledge, including PSI’s review of the copies of such reports furnished to the Company and written representations that no other reports were required during 2020, all Section 16(a) filing requirements were satisfied on a timely basis, except for the following: Mr. Gary Winemaster inadvertently failed to timely file the following for the year ended December 31, 2020: one Form 4 filed in March 2020 (reporting eleven transactions), one Form 4 due in June 2020 (reporting two transactions), one Form 4 due in October (reporting one transaction), one Form 4 due in October (reporting one transaction), two Form 4s due in November (each reporting one transaction), three Form 4s due in December (the first Form 4 reporting five transactions; the second and third Form 4s each reporting one transaction). No reasons were given for the late filings.

Director Compensation

PSI directors receive the following compensation for their services as members of the Board:

The Company also reimburses directors for necessary and reasonable travel and other related expenses incurred in connection with the performance of their official duties of attendance at each meeting of the Board or any Board committee.

The table below summarizes the compensation paid to each director for their service on the Board for the year ended December 31, 2020:

EXECUTIVE COMPENSATION

The named executive officers for the year ended December 31, 2020 were:

Executive Team Transitions

Chief Executive Officer Transition

As previously disclosed, effective February 15, 2021 (the “Retirement Date”), Mr. Miller retired as Chief Executive Officer and President and Kenneth Winemaster, our Senior Vice President, are brothers. There are no other family relationships among the members of our board of directors or our executive officers.

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COMPENSATION DISCUSSION AND ANALYSIS

This Compensation Discussion and Analysis (“CD&A”) explainsLance Arnett, who previously served as the Company’s executive compensation program for its named executive officers consisting of: Gary Winemaster, ourChief Commercial Officer, was promoted to Chief Executive Officer (“CEO”); Eric Cohen, our Chief Operating Office (“COO”), Daniel Gorey, our Chief Financial Officer (“CFO”); and Kenneth Winemaster,as his successor. In connection with Mr. Miller’s retirement from the Company’s only other executive officer (collectively, the “Named Executive Officers”). This CD&A describes the Company’s compensation philosophy and objectives, how the Compensation Committee establishes executive compensation for the Named Executive OfficersCompany, Mr. Miller and the objectives ofCompany entered into a Separation Agreement and Release, effective the various compensation elements.

2013 Advisory Vote on Executive Compensation

At the 2013 Annual Meeting, in a non-binding advisory vote, a substantial majority of the stockholders approved the compensation paid to our Named Executive Officers. The Compensation Committee believes that this affirms stockholders’ support of the Company’s approach to executive compensation. Based on the stockholders’ support of the Company’s executive compensation program, the Compensation Committee did not change its approachRetirement Date (the “Separation Agreement”). Pursuant to the compensationSeparation Agreement and the retirement of its Named Executive Officers. The Compensation Committee remains openMr. Miller, he is entitled to any concerns expressed byreceive (a) a lump-sum cash severance payment of $360,000, (b) subject to his election to receive continued group health plan coverage under COBRA, continued coverage at active-employee rates for up to 12 months after the Company’s stockholdersRetirement Date, and will continue to consider(c) a cash payment of $36,000 under the outcome of future “say-on-pay” votes when making compensation decisions forlong-term incentive plan (“LTI”) at the Company’s Named Executive Officers.

Compensation Philosophy and Objectives

Our compensation program is intended to meet three principal objectives: (1) attract, reward and retain officers andsame time other key employees; (2) motivate these individuals to achieve short-term and long-term corporate goals and enhance stockholder value; and (3) support our core values and culture. To meet these objectives, we have adopted the following overriding policies:

The above policies guideSeparation Agreement also provides that Mr. Miller will assist through a transition support role on an as-needed basis until the Compensation Committee in assessingearlier of 90 days following the proper allocation between long-term compensation, current cash compensation and short-term bonus compensation. Other considerations include our business objectives, our fiduciary and corporate responsibilities (including affordability and accounting and tax implications) and regulatory requirements.

Role of the Compensation Committee and Management

Our executive compensation program is overseen and administered by the Compensation Committee, which is comprised entirely of independent directors as determined in accordance with applicable SEC and NASDAQ rules, including the special factors applicable to compensation committee members. The Compensation Committee operates under a written charter adopted by the Compensation Committee and ratified by the Board. A copy of the charter is publicly available in the “Corporate Governance” section of our website atwww.psiengines.com.

In determining the appropriate compensation packages for our executives, the Compensation Committee considers each executive’s historical compensation, including equity and non-equity based compensation, and equity holdings. In addition, the CEO reviews the performance of each of the executives. The conclusions

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reached, and recommendations made, by the CEO based on these reviews for base salary levels and discretionary bonus amounts are presentedRetirement Date or such earlier date terminated pursuant to the Compensation Committee. As part of this process, the CEO takes into accountSeparation Agreement (the “Transition Period”). Subject to his general knowledge of industry pay levels, using this information for general reference and for perspective on market compensation practices. However, neither the CEO nor the Compensation Committee has engaged in any specific compensation benchmarking or reviewed or relied upon any formal surveys of compensation practices within the Company’s industry or more broadly.

The Compensation Committee relies to a large extent on the CEO’s conclusions and recommendations on each executive’s performance and compensation. However, it is the Compensation Committee which makes the final executive officer compensation determinations, subject (except in the case of equity awards) to the final approval by the full Board. Ultimately, the Compensation Committee makes these determinations on a discretionary basis, applying the compensation philosophy discussed above. Also, in the case of Mr. Cohen, the Compensation Committee is bound bycompliance with the terms of the Separation Agreement, Mr. Miller is entitled to receive a transition fee of $30,000 payable every 30 days during the Transition Period. The Separation Agreement contains a release of the Company by Mr. Miller and mutual non-disparagement provisions. Mr. Miller also agreed that the confidentiality, non-competition and non-solicitation provisions in his current employment agreement with the Company as applicable. Aswill remain in effect. Finally, Mr. Miller agreed to cooperate with, and make himself reasonably available to, the Company continues to evolve and grow asfor a public company, the Compensation Committee may further formalize its compensation practices, which may include benchmarking against industry/peer group compensation, engaging compensation consultants to advise on specific compensation elements and/or tying cash and other incentive awards to the achievement of pre-established financial performance targets.

Role of Compensation Consultant

The Company has not historically used compensation consultants in determining compensation for our Named Executive Officers. Although the Company previously utilized a Compensation Consultant for informal analyses of compensation in similar-sized organizations in like industries and to report and advise on certain matters related to executive compensation, including matters relating to the 2012 Plan and equity awards under the 2012 Plan.

Elements of Executive Compensation

As described in more detail below, the principal elements of our executive compensation program include a mixperiod ending twelve months following termination of the following, at the discretion of the Compensation Committee:

The Compensation Committee uses its discretion to create a mix of compensation elements for each Named Executive Officer that emphasizes both long-term strategic value for stockholders and shorter-term strategic and operational goals.

Base Salary

We provide Named Executive Officers and other employees with a base salary to compensate them for services rendered during the fiscal year. For executives, the amount of base salary is meant to reflect the primary responsibilities of the executive’s position, experience level, management skills and the executive’s contribution to the performance of the Company. In adjusting base salary levels, the Compensation Committee considers the Company’s overall performance (including as to financial results and creation of stockholder value) and, with respect to executives other than the CEO, relies to a large degree upon the recommendations from the CEO

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following his review of the performance of the executive officers. The Compensation Committee does not apply any formulas or assign any criteria specific mathematical weight; instead, the Compensation Committee exercises its judgment and discretion.

Salaries for executive officers are reviewed annually or when there is a change in position or responsibilities, such as a promotion. The Compensation Committee typically approves the base salary increases in January for that fiscal year. In January 2014, the Compensation Committee determined, considering the recommendation of the CEO, that base salaries for fiscal 2014 be as follows: Gary Winemaster, $540,000, Eric Cohen $500,000, Daniel Gorey $285,000 and Kenneth Winemaster $272,500, attempting to align the salary of each Named Executive Officer with his respective responsibilities. The base salaries of all of the aforementioned Named Executive Officers in fiscal 2014 remained the same as in fiscal 2013. Eric Cohen’s base salary was increased from $350,000 on an annualized basis in fiscal 2012 to $500,064 in fiscal 2013Transition Period in order to setassist with the COO’s base salarytransition of his duties at a level more reflectiverate of his responsibilities with the Company. Daniel Gorey’s base salary$250 per hour plus expenses.

Chief Financial Officer Transition

As previously disclosed, Mr. Avery resigned as Chief Financial Officer and Donald P. Klein was increased from $275,000 in fiscal 2012appointed to $285,000 in fiscal 2013 as a result of him serving for a full yearserve as the Company’s CFO.

Discretionary BonusInterim Chief Financial Officer, each effective July 20, 2020 (“Resignation Date”). Mr. Avery transitioned to a consulting role for the Company and entered into a Consulting Agreement and Release, effective on the Resignation Date (the “Consulting Agreement”). Pursuant to the Consulting Agreement Mr. Avery is entitled to receive (a) a cash severance payment of $300,000 in 12 equal monthly installments of $25,000, (b) subject to his election to receive continued group health plan coverage under COBRA, continued coverage at active-employee rates for up to 12 months after the Resignation Date, (c) a cash payment of $155,979.59 under the Company’s Key Performance Indicator (“KPI”) plan for 2019 (and if a KPI plan had been in place for 2020, a prorated bonus through July 20, 2020), and (d) a cash payment of $15,000 for transition services.

The Compensation Committee utilizes discretionary bonuses to provide additional compensationConsulting Agreement also provides that Mr. Avery will assist through a transition support role on an as-needed basis until the earlier of 90 days following the Resignation Date or such earlier date terminated pursuant to the Named Executive Officers, andConsulting Agreement (the “Consulting Period”). Subject to award them for their performance.compliance with the terms of the

Consulting Agreement, Mr. Avery is entitled to receive a consulting fee of $25,000 payable every 30 days during the Consulting Period. The Compensation Committee believes that the immediacy of these bonuses provides an incentive to the Named Executive Officers to raise their individual level of performance, and thus the Company’s overall level of performance. Accordingly, the Compensation Committee believes the bonuses are an important motivating factor for the Named Executive Officers.

The Company has not adopted any formal, or informal, performance or other financial performance or other targets or objectives for the calculation or payment of these discretionary bonuses. Instead, in determining discretionary bonuses awarded, the Compensation Committee considers factors such as the Company’s overall performance for the previous year and stockholder value creation, discretionary bonuses awarded in previous years and the individual performance of the Named Executive Officer, including his particular contributions to the successConsulting Agreement contains a release of the Company (taking into accountby Mr. Avery and mutual non-disparagement provisions. Mr. Avery also agreed that the confidentiality, non-competition and non-solicitation provisions in his particular rolescurrent employment agreement with the Company will remain in effect. Finally, Mr. Avery agreed to cooperate with, and responsibilitiesmake himself reasonably available to, the Company for the Company). As part of its determination, the Compensation Committee relies to a large degree upon the recommendations and conclusionsperiod ending twelve months following termination of the CEO with respecttransition period in order to the performance of each of the Named Executive Officers other than the CEO.

In determining discretionary bonus payments for the Named Executive Officers for fiscal 2014, the Compensation Committee took into account the strong performance by the Company and each Named Executive Officer’s individual contribution to that strong performance. The Compensation Committee approved an initial bonus to Gary Winemaster of $100,000 and approved $750,000 of additional total bonus compensation. Our Chief Executive Officer recommended and the Compensation Committee approved the allocation of the $750,000 of additional bonus compensation as follows: $280,000 to Gary Winemaster, $100,000 to Eric Cohen, $200,000 to Daniel Gorey and $170,000 to Kenneth Winemaster.

Long-Term Equity Incentive Awards

The Compensation Committee has the authority to grant stock options, restricted stock and other awards under the 2012 Plan to the Named Executive Officers and other employees, consultants and directors. The purpose of granting such awards is to provide equity compensation that provides value to these employees when value is also created for the stockholders, and applicable vesting periods are designed to motivate award recipients to remain employees of the Company. For Company executives, the equity compensation is intended to motivate them to make stronger business decisions, improve financial performance and focus on both short-term and long-term objectives and to encourage behavior that protects and enhances the long-term interests of the Company’s stockholders. The Compensation Committee also believes that equity incentive awards are an important retention tool.

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The Compensation Committee determines grants of long-term equity incentive awards based on factors such as overall Company and individual performance, job positions and responsibilities within the Company, growth potential and level of responsibility. The Compensation Committee also considers, for each individual, prior grants and equity holdings, length of time in current position and any change in responsibility, as well as the financial statement expense associatedassist with the grants. As parttransition of its determination, thehis duties and financial matters with which he has knowledge at a rate of $250 per hour plus expenses.

Summary Compensation Committee relies to a large degree upon the recommendations and conclusions of the CEO, based upon his review of the performance of each of the Named Executive Officers.

To date, the Compensation Committee has only granted two equity awards to Named Executive Officers: (i) the Compensation Committee granted a stock appreciation right to Eric Cohen in 2012 as contemplated by his employment agreement executed when he joined the Company in June of 2012 and (ii) the Compensation Committee granted Daniel Gorey restricted stock in 2013. The grant to Eric Cohen was designed to incentivize him over a long-term horizon, so the Compensation Committee did not consider that any additional award to him was necessary or appropriate for 2014. Mr. Cohen’s Stock Appreciation Rights Award Agreement was amended on June 5, 2015 and again on July 6, 2015. For more information on these amendments, please refer to“Securities Authorized for Issuance under Compensation Plans” beginning on page 24. The grant to Daniel Gorey of restricted stock was made to enhance his retention and reward him for the advancement of the Company’s progress as a public company, taking into account that he had not previously received any equity awards from the Company. The Compensation Committee did not consider that any additional award to him was necessary or appropriate for 2014. Gary Winemaster and Kenneth Winemaster have not yet received any awards under the 2012 Plan in light of their significant equity holdings, but the Compensation Committee may make awards to these Named Executive Officers in the future to reward outstanding performance and creation of stockholder value.

Retirement Benefits under the 401(k) Plan, Executive Perquisites and Generally Available Benefit Programs

We also provide the Named Executive Officers with benefits under a 401(k) retirement plan, perquisites and other personal benefits that the Compensation Committee believes are reasonable and consistent with our overall executive compensation program and the Compensation Committee’s executive compensation philosophy, as well as the Compensation Committee’s objective to better enable us to attract and retain the most talented and dedicated executives possible. The Compensation Committee periodically reviews the levels of perquisites and other personal benefits provided to the Named Executive Officers.

Other Matters

Tax-Deductible Performance-Based Compensation

Section 162(m) of the Internal Revenue Code limits to $1,000,000 the annual tax deduction for compensation paid to a Named Executive Officer (other than the Chief Financial Officer), unless such compensation qualifies as performance-based compensation and is paid pursuant to a stockholder approved plan. While base salary, discretionary bonuses and time-based restricted stock do not qualify as performance-based, the stock appreciation rights granted under the 2012 Plan are intended to qualify as performance-based compensation and thus fully deductible under Internal Revenue Code Section 162(m). The Company maintains the flexibility to pay non-deductible compensation if it determines it is in the best interests of the Company and its stockholders.

Compensation Risk Assessment

During fiscal 2014, Company management, along with the Compensation Committee, considered whether any of the Company’s compensation policies and practices had the potential to create risks that are reasonably likely to have a material adverse effect on the Company. Management considered the risk profile of the Company’s business and the design and structure of its compensation policies and practices. The Company concluded that the risks arising from its compensation policies and practices are not reasonably likely to have a material adverse effect on the Company based on the following:

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These factors were discussed with the Compensation Committee during the preparation of this Proxy Statement, and it was concluded that the risks arising from the Company’s compensation policies and practices are not reasonably likely to have a material adverse effect on the Company.

REPORT OF THE COMPENSATION COMMITTEE

The Compensation Committee oversees the Company’s executive compensation program on behalf of the Board. In fulfilling its oversight responsibilities, the Compensation Committee reviewed and discussed with Company management the Compensation Discussion and Analysis set forth in this Proxy Statement. Based on such review and discussion, the Compensation Committee recommended to the Board of Directors the inclusion of the Compensation and Discussion Analysis in this Proxy Statement.

The Compensation Committee

Mary E. Vogt, Chairperson

Jay J. Hansen

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EXECUTIVE COMPENSATIONTable

The table below summarizes the compensation earnedpaid for the fiscal years indicated for services rendered to our company,the Company, in all capacities, by our Named Executive Officersits named executive officers for the fiscal years ended December 31, 2014, 20132020 and 2012.

Summary Compensation Table2019.