DEF 14A of Dorman Products, Inc., Apr 8, 2024

DEF 14A of Dorman Products, Inc.

Filed Apr 8, 2024 · FY20230001140361-24-018500

Open on EDGAR

  1. Eligibility to Vote

    | Pay Ratio | 61 | | Pay vs. Performance | 62 | | Risk Assessment in Compensation Policies and Practices for Employees | 65 | | Compensation Committee Interlocks and Insider Participation | 66 | | Certain Relationships and Related Transactions | 67 | | Security Ownership of Certain Beneficial Owners and Management | 70 | | Report of Audit Committee | 73 | | Information about this Proxy Statement | 74 | | Virtual Meeting | 74 | | Voting Procedures | 74 | | Principal Accountant Fees and Services | 78 | | Pre-Approval Policies and Procedures | 78 | | Shareholder Proposals | 79 | | Annual Report | 79 | | Solicitation of Proxies | 79 | | Other Matters | 80 | | Householding | 80 |

  2. Director Nominees

    Director Nominees

  3. Director Nominees

    | Name | Age | Director Since | Occupation | Independent | Committee Memberships | | | | | | | | | Audit | Compensation | Corporate Governance and Nominating | | Steven L. Berman | 64 | 1978 | Non-Executive Chairman | No | | | | | Kevin M. Olsen | 52 | 2019 | President and Chief Executive Officer | No | | | | | Lisa M. Bachmann | 62 | 2020 | Former Executive Vice President, Chief Merchandising Officer and Operating Officer of Big Lots, Inc. | Yes | | | | | John J. Gavin | 67 | 2016 | Chairman of GMS Inc. | Yes | | | | | Richard T. Riley* | 68 | 2010 | Former Executive Chairman of LoJack Corporation | Yes | | | | | Kelly A. Romano | 62 | 2017 | Founder and Chief Executive Officer of BlueRipple Capital, LLC | Yes | | | | | G. Michael Stakias | 74 | 2015 | President and Chief Executive Officer of Liberty Partners | Yes | | | | | J. Darrell Thomas | 63 | 2021 | Former Vice President and Treasurer of Harley-Davidson, Inc. | Yes | | | |

  4. Director Nominees

    | | Chair | | Member | | * | Lead Director | † | Audit Committee Financial Expert |

  5. Executive Compensation Highlights

    | ✔ | A majority of fiscal 2023 target compensation for named executive officers was variable and performance-based | ✔ | Robust stock ownership guidelines for executive officers | | ✔ | Grants of performance-based restricted stock units that vest based on total shareholder return as compared to companies comprising the S&P Mid-Cap 400 Growth Index | ✔ | Clawback policies for executive officers covering both cash and equity incentive compensation | | ✔ | Mix of diversified short- and long-term performance metrics to incentivize and reward the achievement of strategic objectives | ✔ | No tax gross-up provided under our Executive Severance Plan | | ✔ | Caps on annual and certain long-term incentive programs | ✔ | No excessive perquisites for any of our executive officers | | ✔ | Anti-hedging and anti-pledging policies applicable to executive officers and directors | | |

  6. Proposal III: Ratification of KMPG as our Independent Registered Public Accounting Firm for Fiscal 2024

    | | Steven L. Berman, age 64 Non-Executive Chairman Director Since: 1978 | | Steven L. Berman became the Non-Executive Chairman of the Company effective April 1, 2023, having served as its Executive Chairman since September 2015. Additionally, Mr. Berman has served as a director of the Company since its inception in 1978. From January 2011 to September 2015, Mr. Berman served as Chairman of the Board and Chief Executive Officer of the Company and from October 2007 to January 2011, Mr. Berman served as President of the Company. Prior to October 2007, Mr. Berman served as Executive Vice President of the Company. | | | Key Attributes, Experience and Skills: Mr. Berman has more than 40 years of experience in the automotive aftermarket industry and has been involved with the Company since its formation, including over 40 years in management of the Company. He has the requisite skills to serve as a director of the Company, including particular skills and knowledge in marketing, finance, product development, vendor relations and strategic business management. As a result of his prior positions with the Company, Mr. Berman has substantial industry knowledge and intimate knowledge of the Company’s business, results of operations and financial condition, which enables him to provide unique insights into the Company’s challenges, opportunities, risks and operations. | |

  7. Proposal III: Ratification of KMPG as our Independent Registered Public Accounting Firm for Fiscal 2024

    | | Kevin M. Olsen, age 52 Chief Executive Officer, President and Director Director Since: January 2019 | | | | Public Company Board Service in Past 5 Years: | Twin Disc, Inc., 2022-present | | Mr. Olsen joined the Company in July 2016 as Senior Vice President and Chief Financial Officer. He became Executive Vice President, Chief Financial Officer in June 2017, President and Chief Operating Officer in August 2018 and President and Chief Executive Officer in January 2019. Prior to joining the Company, Mr. Olsen was Chief Financial Officer of Colfax Fluid Handling, a division of Colfax Corporation, a diversified global manufacturing and engineering company that provides gas and fluid-handling and fabrication technology products and services to commercial and governmental customers around the world, from January 2013 through June 2016. Prior to joining Colfax, he served in progressively responsible management roles at the Forged Products Aero Turbine Division of Precision Castparts Corp, Crane Energy Flow Solutions, a division of Crane Co., Netshape Technologies, Inc., and Danaher Corporation. Prior thereto, Mr. Olsen performed public accounting work at PricewaterhouseCoopers LLP. | | | | Key Attributes, Experience and Skills: Mr. Olsen has the ability to provide unique insights as the Company’s current Chief Executive Officer. In addition, he brings to the Board substantial experience in executive leadership and financial management with large organizations, which he gained principally from his service as Chief Executive Officer of Dorman, a role he has held since January 2019, and his prior service as Chief Financial Officer at Dorman and Colfax and his public accounting experience at PricewaterhouseCoopers LLP. | | |

  8. Proposal III: Ratification of KMPG as our Independent Registered Public Accounting Firm for Fiscal 2024

    | | Lisa M. Bachmann, age 62 Director Since: September 2020 Committees: Audit; Compensation; Corporate Governance and Nominating | | | | Public Company Board Service in Past 5 Years: | GMS Inc., 2020-present | | Ms. Bachmann most recently served as Executive Vice President, Chief Merchandising and Operating Officer of Big Lots, Inc. (“Big Lots”), a publicly traded leading discount retailer, from August 2015 to September 2020. Previously, she held various roles at Big Lots, including as Executive Vice President, Chief Operating Officer, as Executive Vice President, Supply Chain Management and Chief Information Officer, and as Senior Vice President, Merchandise Planning, Allocation and Presentation. Prior to joining Big Lots in March 2002, her roles included Senior Vice President of Planning and Allocation for Ames Department Stores Inc. and Vice President of Planning and Allocation for the Casual Corner Group, Inc. | | | | Key Attributes, Experience and Skills: Ms. Bachmann’s qualifications to serve as a director of the Company include her extensive executive leadership experience and business acumen. Her years of experience at Big Lots and several other established retailers provide her with considerable expertise in the areas of management, operations, finance, sales, marketing, distribution, technology, business development and strategy. In addition, Ms. Bachmann has obtained a CERT Certificate in Cyber-Risk Oversight issued by the CERT Division of the Software Engineering Institute at Carnegie Mellon University. | | |

  9. Proposal III: Ratification of KMPG as our Independent Registered Public Accounting Firm for Fiscal 2024

    | | John J. Gavin, age 67 Director Since: October 2016 Committees: Audit; Compensation (Chair); Corporate Governance and Nominating | | | | Public Company Board Service in Past 5 Years: | GMS Inc., 2014-present | | Mr. Gavin was most recently appointed Chairman of GMS Inc. in 2019. Previously, he was a Senior Advisor with LLR Partners, LLC, a middle market, growth oriented private equity firm, from 2010 to 2017, and had been Chairman of Strategic Distribution, Inc. (“SDI”), a leading maintenance, repair, and operations (MRO) supply firm from 2014 to 2017. Prior to holding his Chairman position at SDI, Mr. Gavin served as Chief Executive Officer and President of SDI. Mr. Gavin previously held positions with Drake Beam Morin, Inc., an international career management and transitions management firm, Right Management Consultants, Inc., a publicly traded global provider of integrated consulting solutions across the employment lifecycle, and Arthur Andersen & Co. Mr. Gavin currently serves on the Advisory Board of the Center for Corporate Governance at Drexel University in Philadelphia and on the boards of various privately held companies. | | | | Key Attributes, Experience and Skills: Mr. Gavin is qualified to serve as a director of the Company because of his expertise with financial, accounting, strategic planning, mergers and acquisitions, human resources and career management matters, his extensive management and operational experience, his current and prior service on the board of directors of other publicly and privately held companies and his financial and accounting experience, including his experience as a certified public accountant with a nationally recognized public accounting firm. | | |

  10. Proposal III: Ratification of KMPG as our Independent Registered Public Accounting Firm for Fiscal 2024

    | | Richard T. Riley, age 68 Director Since: March 2010 Committees: Audit (Chair); Compensation; Corporate Governance and Nominating | | | | Lead Director | | | | Public Company Board Service in Past 5 Years: | Tupperware Brands Corporation, 2015-present | | Prior to his retirement from LoJack Corporation, then a public company listed on NASDAQ and a global provider of tracking and recovery systems (“LoJack”), Mr. Riley served in various capacities as Executive Chairman, Chairman, President, Chief Operating Officer and Director from 2005 to 2013. Prior to joining LoJack, Mr. Riley most recently served as Chief Executive Officer, President, Chief Operating Officer and a Director of New England Business Service, Inc. (“NEBS”), then a public company listed on the New York Stock Exchange and a provider of products and services to assist small businesses manage and improve the efficiency of business operations. From February 2005 through December 2018, Mr. Riley also served as a Board member and Chairman of the Supervisory Board of Cimpress, N.V. (f/k/a VistaPrint, N.V.), then a publicly traded Dutch company listed on NASDAQ that invests in and builds customer focused, entrepreneurial, mass customization businesses. From 2000 to the sale of the company in June 2016, Mr. Riley served on the Board, most recently as Vice Chair and significant shareholder (approximately 33%) of Micro-Coax, Inc., a privately held company that manufactured micro coaxial cable, primarily for the defense and space industries. Mr. Riley was formerly a Manager in the audit practice at Arthur Andersen & Co. He also serves as a member of the Board of Trustees at Thomas Jefferson University Hospital and as a member of the Advisory Board of the University of Notre Dame. | | | | Key Attributes, Experience and Skills: Mr. Riley is an experienced leader in the automotive industry with a distinctive knowledge of the automotive products aftermarket. He draws his financial expertise from his experience at Arthur Andersen & Co., his service as an executive at each of LoJack and NEBS, and his service on the audit committees of other public companies. He is skilled in finance, operations, corporate governance, mergers and acquisitions and strategic planning. Mr. Riley’s financial background as a certified public accountant, including his experience at Arthur Andersen & Co., provides financial expertise to the Board, including an understanding of financial statements, corporate finance, accounting and capital markets. | | |

  11. Proposal III: Ratification of KMPG as our Independent Registered Public Accounting Firm for Fiscal 2024

    | | Kelly A. Romano, age 62 Director Since: November 2017 Committees: Audit; Compensation; Corporate Governance and Nominating | | | | Public Company Board Service in Past 5 Years: | UGI Corporation, 2019-present Athira Pharma, Inc., 2020-present | | Ms. Romano is the Chief Executive Officer of BlueRipple Capital, LLC, a consultancy firm she founded in May 2018 that is focused on strategy, acquisitions, deal structure, and channel development for high-technology companies. In addition, she has been an executive advisory board member of Gryphon Investors (“Gryphon”), a private equity firm focused on middle-market investment opportunities, since December 2016, and was Co-Chair of the Board of Potter Electric, one of Gryphon’s portfolio companies in the fire life safety industry until November 2023, when it was acquired by KKR & Co. Inc. Ms. Romano served as an operating partner for AE Industrial Partners, LLC, a private equity firm focused in the aerospace and industrial sectors from August 2020 to August 2023. As an operating partner, she served on several of its portfolio company boards. She remains the Chair of the Board of Altus Fire & Life Safety, a role she has held since May 2021. From 1984 to April 2016, Ms. Romano served in various capacities at United Technologies Corporation (“UTC”), a New York Stock Exchange listed company that provided high-technology products and services to the building and aerospace industries, which merged with Raytheon Corporation in 2020. From September 2014 to April 2016, Ms. Romano served as President, Intelligent Building Technologies for the UTC Building & Industrial Systems business. Previously, she held other executive level positions within UTC including President, Global Security Products, President, Building Systems and Services and President, Distribution Americas. | | | | Key Attributes, Experience and Skills: Ms. Romano has extensive executive leadership experience and business acumen. Ms. Romano’s broad experience in the private equity market and at UTC provides her with a wide-ranging perspective in the areas of management, manufacturing, operations, finance, sales, marketing, distribution, research and development, mergers and acquisitions, business development and strategy. | | |

  12. Proposal III: Ratification of KMPG as our Independent Registered Public Accounting Firm for Fiscal 2024

    | | G. Michael Stakias, age 74 Director Since: September 2015 Committees: Audit; Compensation; Corporate Governance and Nominating (Chair) | | Mr. Stakias has served as President and Chief Executive Officer of Liberty Partners, a New York-based private equity investment firm, since 2008, after serving there as a partner since he joined the firm in 1998. From 1980 to 1998, Mr. Stakias was a partner at Blank Rome LLP, Philadelphia, PA. His practice focused on the areas of corporate securities, mergers and acquisitions, private equity, and public and emerging growth companies. Prior to joining Blank Rome, Mr. Stakias served as Senior Attorney, Division of Corporation Finance, at the Securities and Exchange Commission, Washington, DC. Mr. Stakias serves on the Board of Trustees of the College of William & Mary - Raymond A. Mason School of Business in Williamsburg, VA. | | | Key Attributes, Experience and Skills: Mr. Stakias’ qualifications to serve as a director of the Company include his extensive experience in private equity investment and capital markets, his legal background and his expertise in corporate securities, mergers and acquisitions and corporate finance. Mr. Stakias’ experience in private equity provides him with considerable expertise in financial and strategic matters and his involvement with other entities throughout his career provides him with wide-ranging perspective and experience in the areas of management, operations, and strategy. | |

  13. Proposal III: Ratification of KMPG as our Independent Registered Public Accounting Firm for Fiscal 2024

    | | J. Darrell Thomas, age 63 Director Since: October 2021 Committees: Audit; Compensation; Corporate Governance and Nominating | | | | Public Company Board Service in Past 5 Years: | British American Tobacco p.l.c., 2020-present Pitney Bowes Inc., 2023-present | | Mr. Thomas most recently served as Vice President and Treasurer for Harley-Davidson, Inc., a publicly traded company (“Harley-Davidson”), a position which he held from June 2010 to April 2022. Since joining Harley-Davidson in June 2010, he also served in several senior finance positions, including Interim Chief Financial Officer for Harley-Davidson from July 2020 to September 2020 and Chief Financial Officer for Harley-Davidson Financial Services, Inc. from January 2018 to June 2020. Prior to joining Harley-Davidson, Mr. Thomas was employed by PepsiCo, Inc., a publicly traded company (“PepsiCo”), which he joined in December 2003, and where he most recently served as Vice President and Assistant Treasurer. Prior to joining PepsiCo, Mr. Thomas had a 19-year career in banking with Commerzbank Securities, Swiss Re New Markets, ABN Amro Bank and Citicorp/Citibank where he held various capital markets and corporate finance roles. Mr. Thomas serves as a non-executive director of Scotia Holdings (US) Inc. | | | | Key Attributes, Experience and Skills: Mr. Thomas is qualified to serve as a director of the Company because of his experience with corporate finance, capital markets, risk management and investor relations, his extensive management and operational experience, his service on the boards of directors of other publicly held companies and his financial and accounting experience. | | |

  14. Shareholder Recommendations for Director Nominees

    Shareholder Recommendations for Director Nominees Any shareholder wishing to recommend a candidate for director should submit the recommendation in writing to our principal executive offices: Dorman Products, Inc., 3400 East Walnut Street, Colmar, Pennsylvania, 18915, Attn: Secretary. The recommendation must include the same information that would be required for a candidate to be nominated by a shareholder at a meeting of shareholders as described under the section titled “Shareholder Proposals.”

  15. Independent Director Compensation Program

    Independent Director Compensation Program

  16. 2023 Program

    | 1 | Equity grant of restricted stock units in June 2023 pursuant to the Dorman Products, Inc. 2018 Stock Option and Stock Incentive Plan (the “2018 Equity Plan”) with a grant date value of approximately $125,000 that will vest in full on the earlier of (i) the one year anniversary of the grant date or (ii) the next annual meeting of shareholders of the Company. |

  17. 2024 Program

    2024 Program In December 2023, following a competitive benchmarking exercise conducted by Meridian, and on the recommendation of our Compensation Committee, our Board approved the following amendments to our independent director compensation program: (i) increasing the annual cash retainer from $80,000 to $90,000; and (ii) increasing the grant date value of the annual equity awards of restricted stock units from $125,000 to $135,000. The amendments are effective for fiscal 2024 and beyond. All other terms and conditions of the program remain unchanged.

  18. Director Compensation Table for Fiscal 2023

    Director Compensation Table for Fiscal 2023 The following table sets forth certain information regarding the compensation earned by or awarded to our Non-Executive Chairman and each of our independent directors who served on our Board during the fiscal year ended December 31, 2023. Mr. Olsen, our President and Chief Executive Officer, receives no compensation for his service as a director and is not included in the table below. See “Executive Compensation: Compensation Discussion and Analysis” and “Executive Compensation: Compensation Tables” below for information regarding Mr. Olsen’s employment agreement and his compensation for fiscal 2023.

  19. Director Compensation Table for Fiscal 2023

    | Name | Fees Earned or Paid in Cash ($) | Stock Awards(b) ($) | All Other Compensation(c) ($) | Total ($) | | Steven L. Berman(a) | 121,154 | — | 451,269 | 572,423 | | Lisa M. Bachmann | 80,000 | 124,922 | — | 204,922 | | John J. Gavin | 95,000 | 124,922 | — | 219,922 | | Richard T. Riley | 122,500 | 124,922 | — | 247,422 | | Kelly A. Romano | 80,000 | 124,922 | — | 204,922 | | G. Michael Stakias | 90,000 | 124,922 | — | 214,922 | | J. Darrell Thomas | 80,000 | 124,922 | — | 204,922 |

  20. Director Compensation Table for Fiscal 2023

    | (a) From January 1, 2023 to April 1, 2023, Mr. Berman served as our Executive Chairman and was compensated for his services as such pursuant to the terms of his amended and restated employment agreement. From and after April 1, 2023, Mr. Berman served as our Non-Executive Chairman. For more information regarding Mr. Berman’s amended and restated employment agreement and the fees due to him in connection with his transition to Non-Executive Chairman, please see “— Non-Executive Chairman Compensation” below. Mr. Berman will not receive compensation (other than reimbursement of expenses) under our independent director compensation program until the later of the date of vesting of certain equity awards previously granted to him and April 1, 2026. |

  21. Director Compensation Table for Fiscal 2023

    | (b) Represents the grant date fair value computed in accordance with FASB ASC Topic 718 for awards of restricted stock units granted under our 2018 Equity Plan during fiscal 2023. We calculated the estimated fair value of the restricted stock unit awards issued to those independent directors using the closing price per share of our common stock on the grant date. See also Note 13 of the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. As of December 31, 2023, the aggregate number of unvested restricted stock units held by each independent director was 1,510. |

  22. Director Compensation Table for Fiscal 2023

    | (c) The “All Other Compensation” column consists of the following compensation items for Mr. Berman: transition pay of $298,846 for the period of time from April 1, 2023 to December 31, 2023, $150,000 in lieu of a 2023 cash bonus award as per the Berman Agreement, and company matching contributions under the Dorman Products, Inc. 401(k) Retirement Plan and Trust of $2,423. |

  23. Non-Executive Chairman Compensation

    Non-Executive Chairman Compensation On December 28, 2015, the Company entered into an amended and restated employment agreement with Mr. Berman (the “Berman Agreement”). Pursuant to the Berman Agreement, until April 1, 2023 (the “Succession Date”) Mr. Berman served as Executive Chairman, with all the authorities, duties and responsibilities customarily exercised by an individual serving in this position in a corporation of the size and nature of the Company and such other authorities, duties and responsibilities as may from time to time be reasonably delegated to him by the Board that are consistent with the foregoing. The Berman Agreement provided for an initial term of approximately three years expiring March 31, 2019, with the term of Mr. Berman’s employment being automatically extended for an additional one-year period on March 31, 2019 and on each anniversary of March 31, 2019 thereafter, unless earlier terminated as provided in the agreement. Pursuant to the Berman Agreement, Mr. Berman’s annual base salary was set at $360,000 per year, subject to increase but not decrease from time to time as determined by the Compensation Committee. The Berman Agreement also provided for eligibility for (i) annual bonuses provided under the Company’s cash incentive plans, and (ii) grants of awards under the Company’s equity-related incentive plans, in case of both clauses (i) and (ii) in such amounts as determined by the Compensation Committee, in its sole discretion. Further, the Berman Agreement provided that Mr. Berman would be eligible to participate in other employee benefit plans or arrangements generally available to our senior executives and entitled to not less than four weeks paid vacation per year. In addition, the Berman Agreement contained a clawback provision which provided that any incentive-based compensation, or any other compensation, paid to him that is subject to recovery under any law, government regulation or stock exchange listing requirement, will be subject to such deductions and clawback as may be required to be made pursuant to such law, government regulation or stock exchange listing requirement (or any policy adopted by us pursuant to any such law, government regulation or stock exchange listing requirement). The Berman Agreement could be terminated by us with or without “Cause” or by Mr. Berman for “Good Reason” or for no reason, as such terms are defined in the agreement. The agreement also provided for non-solicitation and non-competition provisions for the term of the agreement and two years thereafter. In addition, the agreement included standard confidentiality and trade secret provisions typically included in agreements of this type. The Berman Agreement contained provisions that provided for certain payments upon termination, including the following payments upon an event of termination as a result of death, disability, without “Cause,” or for “Good Reason”:

  24. Non-Executive Chairman Compensation

    | ■ | in lieu of annual bonuses, annual cash payments in the amount of $150,000, would be paid on each March 15 during the three-year period following the date of termination; and |

  25. Non-Executive Chairman Compensation

    dental, vision and hospitalization benefits provided to Mr. Berman immediately prior to the date of termination or reimburse Mr. Berman for his medical, dental, vision and hospitalization related expenses, subject to reduction if Mr. Berman obtained any such benefits pursuant to a subsequent employer’s benefit plans. Mr. Berman’s employment agreement was filed as an exhibit to our Current Report on Form 8-K filed with the SEC on December 28, 2015. Effective as of the Succession Date, pursuant to a planned succession process, Mr. Berman stepped down from his role as Executive Chairman and was appointed to serve as Non-Executive Chairman. In connection with that planned succession, Mr. Berman’s employment agreement was not renewed and ceased as of the Succession Date. Pursuant to the terms of his employment agreement and in connection with the planned succession process, Mr. Berman will receive: (i) continued annual base salary in the amount of $420,000 for three years following the Succession Date (the “Applicable Period”); (ii) an annual cash bonus in the amount $150,000, on each March 15 during the Applicable Period; and (iii) continued coverage under the Company’s health and welfare plans for the Applicable Period or a stipend for such coverage (collectively, the “Obligations”). Consistent with the terms and provisions of the 2018 Equity Plan, and Mr. Berman’s outstanding equity award agreements thereunder, Mr. Berman’s outstanding unvested equity awards (the “Unvested Awards”) will continue to vest and his vested but unexercised stock option awards (the “Unexercised Option Awards”) will remain exercisable, subject to their expiration date, so long as Mr. Berman serves as a member of the Board. Therefore, because the Obligations, the continued vesting of such Unvested Awards and the continued right to exercise such Unexercised Option Awards will serve as consideration to Mr. Berman while serving as a non-employee director of the Board, Mr. Berman will not receive compensation (other than reimbursement of expenses) under our non-employee director compensation program until the later of the date the Unvested Awards vest and are payable and April 1, 2026. Payment of the Obligations is subject to Mr. Berman’s execution and non-revocation of a release and waiver of claims in favor of the Company and his compliance with certain restrictive covenants, including, without limitation, non-competition and non-solicitation obligations, which are set forth in the transition and release agreement executed by Mr. Berman on February 23, 2023 (the “Transition Agreement”). The Transition Agreement was filed as an exhibit to our Current Report on Form 8-K filed with the SEC on February 24, 2023.

  26. Executive Compensation Philosophy and Objectives

    | ■ | To link a substantial portion of the compensation of our executive officers to the achievement of our annual and long-term financial and other goals; |

  27. Executive Compensation Philosophy and Objectives

    | ■ | To compensate the Company’s executive officers in a manner that reflects their experience, responsibilities and contributions to the annual and long-term growth and development of the Company; |

  28. Executive Compensation Philosophy and Objectives

    We believe that our program focuses management on achieving both annual performance targets and profitable growth over the long term. We believe it is important that our executive compensation program be competitive and attractive when compared to the compensation programs of peers within our industry with which we compete for executive talent. We must be able to attract and retain skillful and knowledgeable management to lead the Company and position the Company for future growth while at the same time being mindful of our responsibility to shareholders to manage costs. Our compensation philosophy reflects a commitment to compensate executives competitively with other companies in the industry while rewarding specific executives for achieving levels of operational excellence and financial returns that seek to ensure positive short- and long-term business performance and growth in shareholder value. We believe that an executive’s total direct compensation should generally reflect the executive’s experience, skill, knowledge, responsibility and individual contributions to the overall success of the Company. Typically, an executive’s total direct compensation will increase to reflect changes in the executive’s functional role and the ability of the executive to affect our performance results. As position and responsibility increase within the Company, a greater portion of the executive’s total direct compensation generally becomes variable. We believe that variable compensation is an excellent way to encourage our executive officers to act in the best interests of our shareholders and to create an environment of shared risk between our executive officers and our shareholders, particularly equity-based variable compensation. We may provide our executive officers with equity awards in connection with our new hire process, for promotions and for retention. In addition, we may provide our executive officers with long-term incentives in the form of stock options and performance or time-based restricted stock units.

  29. Mix of Total Compensation

    | (1) In fiscal 2023, certain named executive officers other than the CEO received an additional one-time restricted stock unit grant which is not included as part of their target compensation and is not included in the above chart. If included, the pay mix for named executive officers other than the CEO would be 38% salary, 26% short-term Incentive, and 37% long-term incentive. |

  30. Role of Our Compensation Consultant

    Role of Our Compensation Consultant The Compensation Committee has the authority under its charter to retain compensation consultants to assist in carrying out its responsibilities. The Compensation Committee has from time to time retained consultants to provide independent advice on executive compensation and to perform specific tasks as requested by the Compensation Committee. Any such consultant reports directly to the Compensation Committee. The Compensation Committee reviews and assesses the independence and performance of any consultant engaged on an annual basis to confirm that the consultant is independent and meets all applicable regulatory requirements. The Compensation Committee engaged Meridian Compensation Partners, LLC, or “Meridian,” as its independent compensation consultant for fiscal 2023. The Compensation Committee assessed the independence of Meridian pursuant to SEC rules and in accordance with Nasdaq listing standards, noting that Meridian does not provide any services to the Company other than advice for the Compensation Committee regarding executive and director compensation, and concluded that no conflict of interest exists.

  31. Competitive Market Pay Information

    Competitive Market Pay Information Meridian, among other things, compiled appropriate survey sources, gathered and analyzed competitive compensation data both from a Willis Towers Watson survey and the most recent proxy statements for the Company’s comparator peer group (see table below), and developed competitive compensation rates for each position. The Compensation Committee references comparator peer group data to assess the competitiveness of the Company’s executive officer compensation program. The Compensation Committee selects the Company’s peer group using a balanced approach that focuses on companies of similar size (revenue, net income, market capitalization and/or enterprise value) and in the same or adjacent sectors (industry/business competitors). For fiscal 2023, the Company approved a revised comparator peer group to use when assessing competitive pay information. The 2023 peer group consisted of 16 companies that were publicly traded on major U.S. exchanges, generally had annual revenues in the range of 33% to 300% of our annual revenues, and were in the auto parts and equipment industry or adjacent industries. The adjustments to the peer group were made to help ensure that the size and industry of our peers continued to be appropriate for benchmarking 2023 pay decisions. The Committee believes that this group, when taken in aggregate, represented a reasonable market reference when determining the competitiveness of our pay programs. The 2023 peer group consisted of the following companies:

  32. Competitive Market Pay Information

    | Fiscal 2023 Peer Group for Compensation Benchmarking | | | American Axle & Manufacturing Holdings, Inc. | Horizon Global Corporation | | CarParts.com, Inc. | LCI Industries | | Cooper-Standard Holdings, Inc. | Modine Manufacturing Company | | Fox Factory Holding Corp. | Motorcar Parts of America, Inc. | | Garrett Motion Inc. | Patrick Industries, Inc. | | Gentex Corporation | Standard Motor Products, Inc. | | Helios Technologies, Inc. | Stoneridge, Inc. | | Holley Inc. | Visteon Corporation |

  33. The Components of Named Executive Officer Compensation

    | Type of Compensation | Objective | | Base Salary | Competitive, fixed compensation | | Annual Performance-Based Cash Awards | Performance incentive linked directly to annual objectives in key financial areas | | Equity Incentive Awards | Time-based restricted stock units provide retention, stock options provide direct shareholder alignment and performance-based incentives link directly to long-term financial objectives and also align with shareholder interests | | ■ Stock Options | | | ■ Time-Based Restricted Stock Units | | | ■ Performance-Based Restricted Stock Units | | | Other Compensation and Benefits | Competitive compensation and retention incentives | | ■ 401(k) Retirement Plan | | | ■ Non-Qualified Deferred Compensation Plan | | | ■ Perquisites and Other Personal Benefits | | | ■ Post-Employment Compensation | |

  34. Annual Performance-Based Cash Bonuses

    Annual Performance-Based Cash Bonuses Overview We use annual performance-based cash bonuses to reward eligible employees at the manager level and above, including our named executive officers, for the successful achievement of the Company’s annual financial performance objectives. The Compensation Committee believes that performance-based cash bonuses assist the Company in motivating and retaining executive talent whose abilities and leadership skills are critical to the Company’s long-term success. Annual cash bonus awards are payable pursuant to the terms of the Company’s 2018 Cash Bonus Plan, or the “2018 Cash Plan,” which was adopted in March 2018 by the Board. The purpose of the 2018 Cash Plan is to align officers’ and other employees’ efforts with the strategic goals of the Company through competitive annual incentive opportunities. The 2018 Cash Plan is administered by the Compensation Committee. Each participant in the 2018 Cash Plan is eligible to receive payment of the award only after certification by the Compensation Committee that such targets have been satisfied. Final payments with respect to awards vary based on the level of achievement measured against the predetermined performance measures. The Compensation Committee has the discretion to reduce or eliminate the amount otherwise payable to a participant if it determines that such a reduction or elimination is in the best interests of our Company. The maximum aggregate bonus amount that may be paid in any single year to any participant under the 2018 Cash Plan is $2,000,000. All awards under the 2018 Cash Plan are subject to the provisions of any clawback or recoupment policy approved by the Board and/or the Compensation Committee, as such policy may be in effect from time to time. In connection with the reorganization of the Company’s business into three reporting segments, Light Duty, Heavy Duty and Specialty Vehicle, the annual cash bonus for fiscal 2023 was structured into four “subplans” – Corporate, Light Duty, Heavy Duty and Specialty Vehicle. For fiscal 2023, Messrs. Olsen, Hession, and Braun participated in the Corporate Subplan. For fiscal 2023, Mr. Darby participated in the Light Duty Subplan, and Mr. McKnight participated in the Light Duty Subplan through June 30, 2023. For the remainder of the year, Mr. McKnight participated in the Heavy Duty Subplan. The decision to allocate half of Mr. McKnight’s annual cash bonus award between the Light Duty Subplan and the Heavy Duty Subplan was based on Mr. McKnight’s assumption of the role of President, Heavy Duty and transition of his prior Light Duty segment duties during the year. None of the named executive officers participated in the Specialty Vehicle Subplan for fiscal 2023. Annual cash bonuses for fiscal 2023 under the Corporate Subplan were based on our fiscal 2023 (i) consolidated adjusted pre-tax income, (ii) consolidated net sales, and (iii) consolidated free cash flow as a percentage of consolidated net income. Each performance goal under the Corporate Subplan was assigned a weighting – 50% for adjusted pre-tax income, 25% for net sales, and 25% for free cash flow as a percentage of net income. Annual cash bonuses for fiscal 2023 under the Light Duty Subplan were based on (i) achievement of the Corporate Subplan’s goals and (ii) fiscal 2023 (a) Light Duty segment adjusted operating income, and (b) Light Duty segment net sales. The performance goals under the Light Duty Subplan were assigned a weighting – 30% for the Corporate Subplan’s overall achievement, and 70% for Light Duty segment adjusted operating income and Light Duty segment net sales. Of that 70%, segment adjusted operating income was assigned a weighting of 75% and segment net sales was assigned a weighting of 25%. Annual cash bonuses for fiscal 2023 under the Heavy Duty Subplan were based on (i) achievement of the Corporate Subplan’s goals and (ii) fiscal 2023 (a) Heavy Duty segment adjusted operating income, and (b) Heavy Duty segment net sales. The performance goals under the Heavy Duty Subplan were assigned a weighting – 30% for the Corporate Subplan’s overall achievement, and 70% for Heavy Duty segment adjusted operating income and Heavy Duty segment net sales. Of that 70%, segment adjusted operating income was assigned a weighting of 75% and segment net sales was assigned a weighting of 25%. Annual cash bonuses for fiscal 2023 under the Specialty Vehicle Subplan were based on (i) achievement of the Corporate Subplan’s goals and (ii) fiscal 2023 (a) Specialty Vehicle segment adjusted operating income, and (b) Specialty Vehicle segment net sales. The performance goals under the Specialty Vehicle Subplan were assigned a weighting – 30% for the Corporate Subplan’s overall achievement, and 70% for Specialty Vehicle segment adjusted operating income and Specialty Vehicle segment net sales. Of that 70%, segment adjusted operating income was assigned a weighting of 75% and segment net sales was assigned a weighting of 25%. Except to the extent the Light Duty, Heavy Duty and Specialty Vehicle subplans include a percentage payout based upon the achievement of results under the Corporate Subplan, each subplan, and the performance metrics included therein, operates independently of the performance metrics of the other subplans. The Compensation Committee believes that basing performance on targets established for adjusted pre-tax income, net sales, and free cash flow as a percentage of net income focuses management’s attention on revenue growth, profitability and availability of cash to fund operations, which are key drivers in building shareholder value. Additionally, the introduction of segment adjusted operating income and segment net sales aligns compensation directly to segment performance. The Compensation Committee believes the design of the fiscal 2023 annual performance-based cash bonus aligns the performance measures to the Company’s strategic plan and incentivizes management to focus on achieving financial goals that are aligned with the Company’s operating budget. 2023 Target Awards Set forth below are the fiscal 2023 annual cash bonus target awards assigned for each of our named executive officers following the competitive benchmarking exercise referenced above.

  35. Annual Performance-Based Cash Bonuses

    | Name | Target (% of Base Salary) | | Kevin M. Olsen | 100% | | David M. Hession | 70% | | Jeffrey L. Darby | 60% | | John R. McKnight | 70% | | Joseph P. Braun | 70% |

  36. Annual Performance-Based Cash Bonuses

    2023 Financial Performance Measures and Actual Results For fiscal 2023, our Compensation Committee set threshold, target, and maximum financial performance measure goals based on our annual operating budget. There would be no annual cash bonus payout with respect to any performance metric for which actual performance did not meet the threshold level. Payout at threshold would be at 50% of target. Achievement between specified performance levels would result in a payout based on linear interpolation. In addition, the annual cash bonus award had a cap of 200% of the target annual incentive opportunity for such performance measure as a maximum award level for each of our named executive officers. Information regarding each subplan’s fiscal 2023 financial performance measures, the applicable threshold, target and maximum goals, and the actual results achieved is set forth below. Corporate Subplan For purposes of the 2023 Corporate Subplan, the following definitions apply: “Adjusted Pre-Tax Income” means the Company’s consolidated income before income taxes for fiscal 2023 determined in accordance with generally accepted accounting principles (“GAAP”), excluding the following items: (a) items generally excluded from earnings per share and earnings before interest, taxes, depreciation and amortization, or EBITDA, by the Company or institutional investors or analysts when evaluating the Company’s performance, such as one-time gains or losses from asset sales, dispute or litigation charges or recoveries, impairment charges, acts of God, restructuring charges and other non-GAAP adjustments, but including normal provisions for slow moving and obsolete inventory and accounts receivable; (b) the impact of any acquisitions, divestitures, discontinuance of business operations, or restructuring; and (c) the cumulative effect of any accounting changes (collectively, the “Adjustment Items”). “Net Sales” and “Net Income” are set forth in the Company’s audited consolidated financial statements for fiscal 2023. “Free Cash Flow” means the Company’s cash provided by operating activities minus property, plant and equipment additions, each as set forth in the Company’ Consolidated Statements of Cash Flows included within the Company’s audited consolidated financial statements for fiscal 2023.

  37. Annual Performance-Based Cash Bonuses

    | Measure ($ in millions) | Threshold | Target | Maximum | Actual | Payout % Earned | | Adjusted Pre-Tax Income | $210.8 | $223.4 | $236.0 | $187.0 | 0% | | Net Sales | $1,892.8 | $1,987.3 | $2,082.3 | $1,929.8 | 70% | | Free Cash Flow as a percentage of Net Income | 75% | 100% | 125% | 127% | 200% | | Actual payout percentage under the 2023 Corporate Subplan (sum of weighted payouts) | | | | | 67% |

  38. Annual Performance-Based Cash Bonuses

    Light Duty Subplan For purposes of the 2023 Light Duty Subplan, the following definitions apply: “LD Adjusted Operating Income” means the income from operations of the Company’s Light Duty operating segment for fiscal 2023 determined in accordance with GAAP, adjusted for allocated corporate expenses, and excluding Adjustment Items. As a result, LD Adjusted Operating Income used in our executive compensation program may differ from the Light Duty segment’s adjusted operating income as reported in our quarterly and annual reports filed with the SEC. See Appendix A to this proxy statement for a reconciliation to the most directly comparable GAAP financial measures. “LD Net Sales” means the consolidated net sales of the Company’s Light Duty operating segment as set forth in the Company’s audited consolidated financial statements for fiscal 2023. The Compensation Committee in its discretion may adjust LD Net Sales and LD Adjusted Operating Income to exclude the impact of any Adjustment Items to the extent it deems appropriate.

  39. Annual Performance-Based Cash Bonuses

    | Measure ($ in millions) | Threshold | Target | Maximum | Actual | Payout % Earned | | LD Adjusted Operating Income | $191.4 | $200.9 | $220.1 | $211.3 | 154% | | LD Net Sales | $1,425.8 | $1,481.4 | $1,539.9 | $1,462.5 | 83% | | Corporate Subplan | 50% | 100% | 200% | | 67% | | Actual payout percentage under the 2023 Light Duty Subplan (sum of weighted payouts) | | | | | 116% |

  40. Annual Performance-Based Cash Bonuses

    Heavy Duty Subplan For purposes of the 2023 Heavy Duty Subplan, the following definitions apply: “HD Adjusted Operating Income” means the income from operations of the Company’s Heavy Duty operating segment for fiscal 2023 determined in accordance with GAAP, adjusted for allocated corporate expenses, and excluding the Adjustment Items. As a result, HD Adjusted Operating Income used in our executive compensation program may differ from the Heavy Duty segment’s adjusted operating income as reported in our quarterly and annual reports filed with the SEC. See Appendix A to this proxy statement for a reconciliation to the most directly comparable GAAP financial measures. “HD Net Sales” means the consolidated net sales of the Company’s Heavy Duty operating segment as set forth in the Company’s audited consolidated financial statements for fiscal 2023. The Compensation Committee in its discretion may adjust HD Net Sales and HD Adjusted Operating Income to exclude the impact of any Adjustment Items to the extent it deems appropriate.

  41. Annual Performance-Based Cash Bonuses

    | Measure ($ in millions) | Threshold | Target | Maximum | Actual | Payout % Earned | | HD Adjusted Operating Income | $34.7 | $37.3 | $39.9 | $19.2 | 0% | | HD Net Sales | $258.3 | $276.4 | $298.3 | $256.9 | 0% | | Corporate Subplan | 50% | 100% | 200% | | 67% | | Actual payout percentage under the 2023 Heavy Duty Subplan (sum of weighted payouts) | | | | | 20% |

  42. Annual Performance-Based Cash Bonuses

    A reconciliation of each of Adjusted Pre-Tax Income and Free Cash Flow, as used in each of the Corporate, Light Duty, Heavy Duty and Specialty Vehicle subplans, to the most directly comparable GAAP measures are included in Appendix A to this proxy statement. 2023 Annual Bonus Payout The table below shows the annual performance-based cash bonuses earned for fiscal 2023 in light of fiscal 2023 financial performance. Such annual cash bonuses were paid in the first quarter of fiscal 2024.

  43. Annual Performance-Based Cash Bonuses

    | | Award Opportunity at Target | Actual Award | % Achievement | | Kevin M. Olsen | $900,000 | $603,000 | 67% | | David M. Hession | $350,000 | $234,500 | 67% | | Jeffrey L. Darby | $274,560 | $318,490 | 116% | | John R. McKnight | $315,000 | $214,200 | 68% | | Joseph P. Braun | $315,000 | $211,050 | 67% |

  44. Equity Awards

    Equity Awards Compensation may be awarded to our named executive officers in the form of equity-based awards. Equity awards are designed to focus our named executive officers on our key long-term financial and strategic objectives and encourage them to take into account our and our shareholders’ long-term interests through ownership of our common stock. Awards made under our equity plan recognize a named executive officer’s contribution to our overall corporate performance and provide a financial incentive to achieve our long-term goals. We provide our named executive officers with long-term incentives in the form of stock options with time-based vesting and grants of restricted stock units with time and performance-based vesting. Prior to 2020, we also provided certain of our named executive officers with long-term incentives in the form of grants of restricted stock with performance-based and time-based vesting. The time-based element of our equity awards has been structured as an incentive for continued employment and to align the interests of our named executive officers with those of shareholders. Performance-based equity awards reinforce our commitment to a pay for performance philosophy as awards are only earned if specific levels of performance are achieved. We also may grant equity awards to named executive officers in connection with commencement of employment, for promotions and retention, among other reasons. The Compensation Committee considers a number of factors when determining the size and mix of each equity award granted to our named executive officers, including the experience, expertise and responsibility of each named executive officer, the financial performance of the Company, market competitiveness, and such other factors as deemed appropriate, consistent with our previously described compensation philosophy. The Compensation Committee may adjust on a year-over-year basis equity grant levels of our named executive officers annually based on a number of factors including, but not limited to, market competitiveness and retention. See the Grants of Plan-Based Awards for Fiscal 2023 table for more information. All equity awards issued to our named executive officers in fiscal 2023 were issued pursuant to the Dorman Products, Inc. 2018 Stock Option and Stock Incentive Plan, or the “2018 Equity Plan.” For fiscal 2023, the Company granted the following mix of long-term incentive equity-based awards to our named executive officers: performance-based restricted stock units (50%), time-based restricted stock units (25%), and non-qualified stock options (25%). Under the Dorman Products, Inc. Policy Regarding the Granting of Equity-Based Compensation Awards, subject to certain exceptions, annual incentive awards are made in March of each year. Any off-cycle awards, for promotions, retention and newly-hired employees, for example, generally are made on the first trading day of each month. The Compensation Committee adopted the policy to promote consistent practices in connection with grants of equity awards and to help ensure that the grant dates for such awards are determined independently from the timing of the release of any material, non-public information by the Company.

  45. Stock Options

    Stock Options On March 2, 2023, the Compensation Committee approved the grant to each named executive officer of stock options, with an exercise price equal to our share price on the date of grant. The stock options vest 25% per year, beginning with the first anniversary of the date of grant, and expire on the eighth anniversary of the date of grant. Such stock options have value to the recipient only if the Company’s stock price appreciates from the date of grant, which aligns the interests of our named executive officers with those of our stockholders and is consistent with our pay-for-performance philosophy. The number of shares of our common stock subject to each stock option awarded to our named executive officers in fiscal 2023 is set forth in the Grants of Plan-Based Awards for Fiscal 2023 table.

  46. Time-Based Restricted Stock Units

    Time-Based Restricted Stock Units On March 2, 2023, the Compensation Committee approved the grant to each named executive officer of time-based restricted stock units that vest 25% per year, beginning with the first anniversary of the date of grant. Also on March 2, 2023, the Compensation Committee approved the grant to Messrs. Darby and McKnight of restricted stock units that vest 33% per year, beginning with the first anniversary of the date of grant. Each restricted stock unit corresponds to a single share of our common stock. Upon each vesting date, the number of restricted stock units that then vest is settled in a like number of shares of our common stock. The Compensation Committee believes that time-based restricted stock units promote retention of our named executive officers and align the interests of our named executive officers with shareholders by providing long-term stock ownership opportunities. In addition, the Compensation Committee believes that the additional incentive award provides enhanced retention and performance incentives and promotes long-term stock ownership. The number of shares of our common stock subject to each time-based restricted stock unit awarded to our named executive officers in fiscal 2023 is set forth in the Grants of Plan-Based Awards for Fiscal 2023 table.

  47. Performance-Based Restricted Stock Units

    Performance-Based Restricted Stock Units On March 2, 2023, the Compensation Committee approved the grant to each named executive officer of performance-based restricted stock units (the “2023 PRSU”). The Compensation Committee believes the awards of performance-based restricted stock units support our goal for creating long-term shareholder value. The 2023 PRSU will vest (if at all) after the completion of a three-year performance period ending December 31, 2025 (the “2023-2025 Performance Cycle”) based on achieved performance against pre-determined performance metrics. The Compensation Committee, with input from Meridian, determined that the performance metric for the 2023 PRSU would be the Company’s three-year total shareholder return, or “TSR,” compared to a TSR peer group, which we refer to as relative TSR, or “RTSR.” The Compensation Committee believes using the RTSR metric is consistent with the Company’s compensation philosophy, which emphasizes a pay for performance environment and linkage to shareholder interests. The Compensation Committee selected, with the assistance of Meridian, the companies within the S&P Mid-Cap 400 Growth Index, or, the “S&P Growth Index,” to use as the TSR peer group for primarily the following reasons:

  48. Performance-Based Restricted Stock Units

    | ■ | it consists of growth companies with market capitalizations similar to the Company; |

  49. Performance-Based Restricted Stock Units

    | ■ | the companies in the S&P Growth Index typically do not pay dividends, similar to the Company; and |

  50. Performance-Based Restricted Stock Units

    | ■ | the companies in the S&P Growth Index are expected to experience above average increases in revenue and earnings. |

  51. Performance-Based Restricted Stock Units

    Each named executive officer may earn between 0% to 200% of the target number of shares awarded depending on the Company’s performance during the 2023-2025 Performance Cycle, subject to a payout cap described below. The Compensation Committee has assigned target, threshold and maximum percentile values to the RTSR performance metric. The Compensation Committee adopted the RTSR performance percentiles based on its assessment that such percentiles reflect market competitive long-term incentive pay practices, as well as meaningful levels of relative performance that warrant payouts at threshold, target and maximum levels. The percentiles were set for compensation purposes only and do not constitute, and should not be viewed as, management’s projection of future results. The threshold percentile level must be met for any shares to vest under the 2023 PRSU. The maximum number of shares that may be issued on vesting of performance-based restricted stock units is capped so that the value received on vesting cannot be greater than 400% of the value of the performance-based restricted stock units at the grant date using the target number of performance-based restricted stock units. The number of units that vest if performance is between the threshold, target and maximum levels will be determined using straight line interpolation. The following table sets forth the percentage of the 2023 PRSU that will vest at the end of the three-year performance period based on the level of performance.

  52. Performance-Based Restricted Stock Units

    | | <Minimum | Minimum | Target | Maximum | | RTSR(1) | Below 25th Percentile | 25th Percentile | 50th Percentile | 80th Percentile or Above | | Vested Percent of 2023 PRSU | 0% | 50% | 100% | 200% |

  53. Performance-Based Restricted Stock Units

    | (1) The 2023 PRSU defined RTSR as a comparison of the Company’s TSR to the TSR of the companies comprising the S&P Growth Index for the measurement period. TSR is calculated using the change in share price during the performance period, along with dividends paid. The calculation assumes that dividends are reinvested, and it also adjusts for stock splits. RTSR performance is calculated using the trailing 60-trading day average closing stock prices of the trading days immediately preceding the first day and last day of the measurement period. |

  54. Performance-Based Restricted Stock Units

    The Compensation Committee will determine the final payouts under the 2023 PRSU in the first quarter of the year following the end of the performance period. The number of shares subject to the 2023 PRSUs granted to our named executive officers is set forth in the Grants of Plan-Based Awards for Fiscal 2023 table.

  55. 2021 Awards

    | ■ | the threshold, target and maximum performance-based restricted stock unit amounts payable to the named executive officers; |

  56. 2021 Awards

    | ■ | the goals for threshold, target and maximum payout. |

  57. 2021 Awards

    The payouts for the 2021 PRSU could have ranged from 0% to 200% of each participating named executive officer’s target, with a threshold payout equal to 50% of target and a maximum payout equal to 200% of target. For the 2021 PRSU to be earned, the threshold or minimum achievement level must have been attained. To emphasize its pay-for-performance philosophy, the Compensation Committee set target at the 55th percentile, requiring above-median performance for a target payout of 100%. The number of shares that vest if performance is between the threshold, target and maximum levels is determined using straight line interpolation. The table below shows the number of shares that each named executive officer who received a 2021 PRSU award had the potential to earn under the 2021 PRSU at the threshold, target and maximum levels.

  58. 2021 Awards

    | SHARE PAYOUT OPPORTUNITIES UNDER THE 2021 PRSU | | | | | Name | Threshold (#) | Target (#) | Maximum (#) | | Kevin M. Olsen | 3,160 | 6,320 | 12,640 | | David M. Hession | 778 | 1,556 | 3,112 | | Jeffrey L. Darby | 624 | 1,248 | 2,496 | | John R. McKnight | 609 | 1,218 | 2,436 | | Joseph P. Braun | 707 | 1,414 | 2,828 |

  59. 401(k) Retirement Plan

    401(k) Retirement Plan Our named executive officers are eligible to participate in the Company’s 401(k) Retirement Plan because they satisfy certain age and service requirements. We offer the 401(k) Retirement Plan to enhance our ability to attract and retain talented executives and other employees and to encourage them to systematically save for retirement. Individual accounts are maintained for the cash contributions made on behalf of each eligible employee, and each eligible employee has a choice of investment options from among a variety of mutual funds and professionally managed accounts as to the contributions to the account. There are three types of contributions to the 401(k) Retirement Plan: (1) voluntary employee contributions, which we deduct from each participating employee’s compensation (subject to certain limits established by law); (2) a company discretionary contribution which, if made, may be made in cash, common stock or a combination thereof, and where the amount of any such discretionary contribution is determined by multiplying the applicable percentage approved by the Compensation Committee by the employee’s annual compensation; and (3) a company discretionary matching contribution to each eligible employee. Benefits under the 401(k) Retirement Plan are payable at age 65 (normal retirement), total disability, death, or, if earlier, upon employment termination if so elected by the participant. There are no vesting requirements for employee voluntary contributions. Company discretionary contributions vest 20% each year beginning at two years of service, with 100% vesting at six years or more. The vesting schedule for the matching contribution is 100% cliff vesting at three years of service. For fiscal 2023, we made discretionary matching contributions to each eligible employee equal to 50% of the first 4% of compensation contributed to the 401(k) Retirement Plan by the eligible employee as voluntary contributions. In addition, for fiscal 2023 we made company discretionary contributions in an amount equal to 4% of each eligible participant’s annual compensation (with certain limitations to highly compensated employees). Both of the Company discretionary contributions were funded entirely in cash.

  60. Non-Qualified Deferred Compensation Plan

    Non-Qualified Deferred Compensation Plan The Dorman Products, Inc. Non-Qualified Deferred Compensation Plan, referred to as the “Non-Qualified Deferred Compensation Plan,” is intended to benefit a select group of our highly compensated employees, including our named executive officers, who are key to our future success, and to help attract and retain management talent. Our Non-Qualified Deferred Compensation Plan is an unfunded arrangement and is intended to be exempt from the participation, vesting, funding and fiduciary requirements of the Employee Retirement Income Security Act of 1974, as amended, or ERISA. The Non-Qualified Deferred Compensation Plan is intended to comply with Section 409A of the Code. Under our Non-Qualified Deferred Compensation Plan, a participant may contribute, on a tax deferred basis, up to 25% of his or her base salary and 90% of his or her bonus annually. A participant’s account is notionally invested in one or more investment funds and the value of the account is determined with respect to such investment allocations. The minimum deferral period is two years for in-service accounts. Each participant is 100% vested in all of his or her deferred contributions plus any earnings or losses on the investment of such deferrals. Deferred amounts will be distributed, either in lump sum or in equal installments over up to five years depending upon the participant’s balance, upon the occurrence of the following events: (i) the first day of the seventh month after separation of employment; (ii) on a specified date selected by the participant after a minimum deferral period; (iii) death; (iv) disability (as defined by Section 409A of the Code); or (v) the occurrence of an “unforeseen emergency” as defined in the Non-Qualified Deferred Compensation Plan. Although the Non-Qualified Deferred Compensation Plan permits discretionary employer contributions, we have not yet made a contribution to the plan. In order for our Non-Qualified Deferred Compensation Plan to comply with the applicable requirements of the Code, amounts deferred by our named executive officers must remain as employer assets, subject to the claims of our general creditors in the event of bankruptcy or forced liquidation of the Company.

  61. Employment Agreements

    Employment Agreements As a general matter, other than for the Chief Executive Officer, we do not enter into employment agreements with our executive officers. See “Executive Compensation: Compensation Tables – Narrative Disclosure to Summary Compensation and Grants of Plan-Based Award Tables” for a description of Mr. Olsen’s employment agreement. See “Director Compensation – Non-Executive Chairman Compensation” for information regarding the prior employment agreement for our Non-Executive Chairman.

  62. Post-Employment and Change in Control Benefits

    Post-Employment and Change in Control Benefits We provide severance protection to our executives to give them financial security in the event they suffer an involuntary termination other than for cause. The payment of the severance benefits is linked to our compensation philosophy of encouraging the retention of our executives who successfully contribute to our short- and long-term goals. Effective December 26, 2021, the Compensation Committee adopted the Dorman Products, Inc. Executive Severance Plan, referred to as the “Severance Plan,” to provide severance benefits to certain eligible employees of the Company and its affiliates who experience a termination of employment under the conditions described in the Severance Plan. Eligible employees under the Severance Plan include, among others, employees with the title of President or Senior Vice President who are designated as a participant by the Compensation Committee. Each of the Company’s named executive officers, other than Mr. Olsen, has been designated a participant in the Severance Plan. Mr. Olsen is not a participant in the Severance Plan because his severance benefits are governed by the terms of his employment agreement with the Company. See “Executive Compensation: Compensation Tables — Potential Payments upon Termination or Change in Control” for more information.

  63. 2024 Comparator Peer Group

    2024 Comparator Peer Group The Compensation Committee, with the recommendation of Meridian, approved a revised comparator peer group to use when determining competitive pay information for fiscal 2024. The peer group consists of 15 companies in Auto Parts & Equipment and moderately related industries that are publicly traded on major U.S. exchanges and generally have annual revenues in the range of 33% to 300% of our annual revenues. The adjustments to the peer group include removing one peer, Horizon Global Corporation, which was acquired by another company during fiscal 2023. The Committee believes that this group, when taken in aggregate, represents a reasonable market reference when determining the competitiveness of our pay programs for fiscal 2024.

  64. 2024 Comparator Peer Group

    | Fiscal 2024 Peer Group | | | American Axle & Manufacturing Holdings, Inc. | LCI Industries | | CarParts.com, Inc. | Modine Manufacturing Company | | Cooper-Standard Holdings Inc. | Motorcar Parts of America, Inc. | | Fox Factory Holding Corp. | Patrick Industries, Inc. | | Garrett Motion Inc. | Standard Motor Products, Inc. | | Gentex Corporation | Stoneridge, Inc. | | Helios Technologies, Inc. | Visteon Corporation | | Holley Inc. | |

  65. Summary Compensation Table for Fiscal 2023

    Summary Compensation Table for Fiscal 2023 The following table sets forth summary information relating to all compensation awarded to, earned by or paid to our named executive officers for all services rendered in all capacities to us and our subsidiaries during the fiscal years noted below:

  66. Summary Compensation Table for Fiscal 2023

    | Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards(1) ($) | Option Awards(2) ($) | Non-Equity Incentive Plan Compensation(3) ($) | All Other Compensation(4) ($) | Total ($) | | Kevin M. Olsen President and Chief Executive Officer | 2023 | 884,513 | | 2,087,453 | 599,999 | 603,000 | 44,101 | 4,219,066 | | | 2022 | 807,404 | — | 1,489,429 | 449,989 | 291,600 | 41,561 | 3,079,983 | | | 2021 | 665,135 | — | 1,148,628 | 320,608 | 1,201,500 | 41,637 | 3,377,508 | | David M. Hession Senior Vice President, Chief Financial Officer and Treasurer | 2023 | 497,464 | | 391,259 | 112,495 | 234,500 | 23,148 | 1,258,866 | | | 2022 | 479,133 | — | 550,867 | 90,936 | 96,030 | 25,883 | 1,242,849 | | | 2021 | 448,833 | — | 282,795 | 78,940 | 441,627 | 24,027 | 1,276,222 | | Jeffrey L. Darby Senior Vice President, Sales & Marketing | 2023 | 454,904 | | 398,272 | 85,776 | 318,490 | 22,291 | 1,279,733 | | | 2022 | 436,937 | — | 468,251 | 65,994 | 79,200 | 23,939 | 1,074,321 | | | 2021 | 420,171 | — | 226,818 | 63,317 | 375,847 | 20,003 | 1,106,156 | | John McKnight(5) President, Heavy Duty | 2023 | 446,598 | | 452,148 | 101,224 | 214,200 | 22,131 | 1,236,301 | | | 2022 | 426,885 | — | 516,736 | 80,616 | 85,140 | 20,738 | 1,130,115 | | Joseph P. Braun Senior Vice President, General Counsel and Secretary | 2023 | 446,079 | | 352,196 | 101,224 | 211,050 | 22,120 | 1,132,669 | | | 2022 | 424,058 | — | 514,823 | 80,034 | 84,546 | 20,681 | 1,124,142 | | | 2021 | 405,889 | — | 256,987 | 71,746 | 401,390 | 23,168 | 1,159,180 |

  67. Summary Compensation Table for Fiscal 2023

    | (1) Represents the grant date fair value of awards determined in accordance with FASB ASC Topic 718. See also Note 12 of the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. Stock awards granted in fiscal 2023 include grants of: (i) time-based restricted stock units and (ii) performance-based restricted stock units. We calculated the estimated fair value of the time-based restricted stock unit awards using the closing price per share of our common stock on the grant date. The grant date fair value for the performance-based restricted stock unit awards granted in fiscal 2023 was $113.15 per share based on the application of a Monte Carlo simulation model. Under FASB ASC Topic 718, the RTSR metric applicable to the performance-based restricted stock unit awards issued in fiscal 2023 is a market condition and not a performance condition. Accordingly, there is not a grant date fair value below or in excess of the amounts reflected in the table above that could be calculated and disclosed based on achievement of market conditions. The stock awards granted in fiscal 2023 are subject to vesting conditions described under “Executive Compensation: Compensation Discussion and Analysis – The Components of Named Executive Officer Compensation – Equity Awards.” |

  68. Summary Compensation Table for Fiscal 2023

    | (2) Represents the grant date fair value of option awards determined in accordance with FASB ASC Topic 718. We calculate the grant date fair value of option awards using the Black-Scholes option pricing model using assumptions set forth in Note 12 of the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. |

  69. Summary Compensation Table for Fiscal 2023

    | (3) Represents annual performance-based cash bonuses paid to our named executive officers after the fiscal year with respect to that fiscal year’s performance. All incentive cash bonus awards issued in fiscal 2023 to our named executive officers were issued pursuant to our 2018 Cash Plan. |

  70. Summary Compensation Table for Fiscal 2023

    | (4) The “All Other Compensation” column for the fiscal year ended December 31, 2023 includes the following compensation items: |

  71. Summary Compensation Table for Fiscal 2023

    | Named Executive Officer | Discretionary Company Contribution to 401(k) Retirement Plan ($) | Discretionary Company Matching Contribution to 401(k) Retirement Plan ($) | Executive Life Insurance Premiums ($) | Executive Disability Insurance Premiums ($) | Total ($) | | Kevin M. Olsen | 13,200 | 17,688 | 2,527 | 10,686 | 44,101 | | David M. Hession | 13,200 | 9,948 | — | — | 23,148 | | Jeffrey L. Darby | 13,200 | 9,091 | — | — | 22,291 | | John R. McKnight | 13,200 | 8,931 | — | — | 22,131 | | Joseph P. Braun | 13,200 | 8,920 | — | — | 22,120 |

  72. Summary Compensation Table for Fiscal 2023

    | (5) Mr. McKnight served as Senior Vice President, Operations prior to becoming President, Heavy Duty effective March 10, 2023. |

  73. Grants of Plan-Based Awards for Fiscal 2023

    Grants of Plan-Based Awards for Fiscal 2023 The following table sets forth information regarding grants of plan-based awards to our named executive officers during the fiscal year ended December 31, 2023:

  74. Grants of Plan-Based Awards for Fiscal 2023

    | | | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(1) | | | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | | | All Other Stock Awards: Number of Shares of Stock or Units(3) (#) | All Other Option Awards: Number of Securities Underlying Options(4) (#) | Exercise or Base Price of Option Awards ($/Sh) | Grant Date Fair Value of Stock and Option Awards(5) ($) | | Name | Grant Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | | | Kevin M. Olsen | — | 450,000 | 900,000 | 1,800,000 | — | — | — | — | — | — | — | | | 3/2/2023 | — | — | — | 6,573 | 13,146 | 26,292 | — | — | — | 1,487,470 | | | 3/2/2023 | — | — | — | — | — | — | — | 16,662 | 91.28 | 599,999 | | | 3/2/2023 | — | — | — | — | — | — | 6,573 | — | — | 599,983 | | David M. Hession | — | 175,000 | 350,000 | 700,000 | — | — | — | — | — | — | — | | | 3/2/2023 | — | — | — | 1,232 | 2,464 | 4,928 | — | — | — | 278,802 | | | 3/2/2023 | — | — | — | — | — | — | — | 3,124 | 91.28 | 112,495 | | | 3/2/2023 | — | — | — | — | — | — | 1,232 | — | — | 112,457 | | Jeffrey L. Darby | — | 137,280 | 274,560 | 549,120 | — | — | — | — | — | — | — | | | 3/2/2023 | — | — | — | 939 | 1,879 | 3,758 | — | — | — | 212,609 | | | 3/2/2023 | — | — | — | — | — | — | — | 2,382 | 91.28 | 85,776 | | | 3/2/2023 | — | — | — | — | — | — | 939 | — | — | 85,712 | | | 3/2/2023 | — | — | — | — | — | — | 1,095 | — | — | 99,952 | | John R. McKnight | — | 157,500 | 315,000 | 630,000 | — | — | — | — | — | — | — | | | 3/2/2023 | — | — | — | 1,109 | 2,218 | 4,436 | — | — | — | 250,967 | | | 3/2/2023 | — | — | — | — | — | — | — | 2,811 | 91.28 | 101,224 | | | 3/2/2023 | — | — | — | — | — | — | 1,109 | — | — | 101,230 | | | 3/2/2023 | — | — | — | — | — | — | 1,095 | — | — | 99,952 | | Joseph P. Braun | — | 157,500 | 315,000 | 630,000 | — | — | — | — | — | — | — | | | 3/2/2023 | — | — | — | 1,109 | 2,218 | 4,436 | — | — | — | 250,967 | | | 3/2/2023 | — | — | — | — | — | — | — | 2,811 | 91.28 | 101,224 | | | 3/2/2023 | — | — | — | — | — | — | 1,109 | — | — | 101,230 |

  75. Grants of Plan-Based Awards for Fiscal 2023

    | (1) Represents the potential fiscal 2023 annual cash bonus awards under the 2018 Cash Plan. See “Executive Compensation: Compensation Discussion and Analysis – The Components of Named Executive Officer Compensation – Annual Performance-Based Cash Bonuses” for more information on the fiscal 2023 annual cash bonus awards, including the applicable performance conditions. Actual cash amounts paid in connection with the fiscal 2023 annual cash bonus awards are set forth in the Summary Compensation Table above. |

  76. Grants of Plan-Based Awards for Fiscal 2023

    | (2) Represents performance-based restricted stock unit awards granted under the 2018 Equity Plan in fiscal 2023. Such awards are subject to vesting and performance conditions described under “Executive Compensation: Compensation Discussion and Analysis – The Components of Named Executive Officer Compensation – Equity Awards.” |

  77. Grants of Plan-Based Awards for Fiscal 2023

    | (3) Represents time-vested restricted stock unit awards granted under the 2018 Equity Plan in fiscal 2023. Such awards are subject to vesting conditions described under “Executive Compensation: Compensation Discussion and Analysis – The Components of Named Executive Officer Compensation – Equity Awards.” |

  78. Grants of Plan-Based Awards for Fiscal 2023

    | (4) Represents options to purchase common stock granted under the 2018 Equity Plan in fiscal 2023. Such options are subject to vesting conditions described under “Executive Compensation: Compensation Discussion and Analysis – The Components of Named Executive Officer Compensation – Equity Awards.” |

  79. Grants of Plan-Based Awards for Fiscal 2023

    | (5) Represents the grant date fair value computed in accordance with ASC Topic 718. See also Note 12 of the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and Footnotes 1 and 2 to the Summary Compensation Table above. |

  80. Narrative Disclosure to Summary Compensation and Grants of Plan-Based Awards Tables

    Narrative Disclosure to Summary Compensation and Grants of Plan-Based Awards Tables Employment Agreement with Kevin M. Olsen. On December 13, 2021, the Company entered into an amended and restated employment agreement (the “Amended Agreement”) with Mr. Olsen. The Amended Agreement became effective as of December 26, 2021 and superseded Mr. Olsen’s prior employment agreement with the Company. The Amended Agreement has no fixed term of employment. Pursuant to the Amended Agreement, Mr. Olsen’s base salary was set at $810,000, subject to increase (but not decrease) as determined by the Compensation Committee. The Amended Agreement provides for eligibility for (i) annual cash bonuses under the Company’s cash incentive plans, and (ii) grants of awards under the Company’s equity-related incentive plans, in case of both clauses (i) and (ii) in such amounts as determined by the Compensation Committee, in its sole discretion. Further, the Amended Agreement provides that, subject to limitations related to the amount of applicable premiums, we would acquire and pay the applicable premium on (i) a $2.0 million term life insurance policy on the life of Mr. Olsen which will be payable to a beneficiary designated by Mr. Olsen, and (ii) a long-term disability insurance policy for Mr. Olsen with a benefit in the amount of 60% of Mr. Olsen’s monthly earnings as of immediately prior to the incurrence of a disability. Mr. Olsen would also be eligible to participate in other employee benefit plans or arrangements generally available to our named executive officers and entitled to four weeks paid vacation per year. The Amended Agreement may be terminated by us with or without “Cause” or by Mr. Olsen for “Good Reason” or for no reason, as such terms are defined in the Amended Agreement. The Amended Agreement also provides for non-solicitation and non-competition provisions for the term of the agreement and eighteen months thereafter and includes standard confidentiality and trade secret provisions typically included in agreements of that type. The Amended Agreement contains a clawback provision that provides that the compensation and benefits provided by the Company under the Amended Agreement or otherwise is subject to recoupment or clawback under any applicable Company clawback or recoupment policy that is generally applicable to the Company’s executives, as may be in effect from time to time, or as required by law, government regulation or stock exchange listing requirement. The Amended Agreement provides that Mr. Olsen will be eligible for certain payments upon termination of employment, including certain terminations of employment following a change in control. See “Executive Compensation: Compensation Discussion and Analysis – The Components of Named Executive Officer Compensation – Post-Employment and Change in Control Benefits” for more information.

  81. 2018 Stock Option and Stock Incentive Plan

    | ■ | the maximum grant date value of shares subject to awards granted to any non-employee director during any calendar year, taken together with any cash fees payable to such non-employee director for services rendered during the calendar year, may not exceed $500,000 in total value. |

  82. Outstanding Equity Awards at December 31, 2023

    Outstanding Equity Awards at December 31, 2023 The following table sets forth for each of our named executive officers information regarding unexercised options and unvested stock awards outstanding at December 31, 2023:

  83. Outstanding Equity Awards at December 31, 2023

    | | | Option Awards | | | | Stock Awards | | | | | Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable(1) | Number of Securities Underlying Unexercised Options (#) Unexercisable(2) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested(3) (#) | Market Value of Shares or Units of Stock That Have Not Vested(4) ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested(4) ($) | | Kevin M. Olsen | 3/6/2019 | 4,749 | — | 82.03 | 3/6/2027 | — | — | — | — | | | 3/6/2019 | — | — | — | — | 2,031 | 169,406 | — | — | | | 3/2/2020 | 8,772 | 2,925 | 61.68 | 3/2/2028 | — | — | — | — | | | 3/2/2020 | — | — | — | — | 814 | 67,896 | — | — | | | 3/2/2021 | 5,058 | 5,059 | 101.45 | 3/2/2029 | — | — | — | — | | | 3/2/2021 | — | — | — | — | — | — | 3,160(5) | 263,576 | | | 3/2/2021 | — | — | — | — | 1,580 | 131,788 | — | — | | | 3/2/2022 | 3,477 | 10,433 | 96.36 | 3/2/2030 | — | — | — | — | | | 3/2/2022 | — | — | — | — | — | — | 9,339(6) | 778,966 | | | 3/2/2022 | — | — | — | — | 3,502 | 292,102 | — | — | | | 3/2/2023 | — | 16,662 | 91.28 | 3/2/2031 | — | — | — | — | | | 3/2/2023 | — | — | — | — | — | — | 13,146(7) | 1,096,508 | | | 3/2/2023 | — | — | — | — | 6,573 | 548,254 | — | — | | David M. Hession | 3/1/2019 | 8,768 | — | 83.75 | 3/1/2027 | — | — | — | — | | | 3/6/2019 | 2,243 | — | 82.03 | 3/6/2027 | — | — | — | — | | | 3/2/2020 | 5,052 | 1,686 | 61.68 | 3/2/2028 | — | — | — | — | | | 3/2/2020 | — | — | — | — | 471 | 39,286 | — | — | | | 3/2/2021 | 1,244 | 1,247 | 101.45 | 3/2/2029 | — | — | — | — | | | 3/2/2021 | — | — | — | — | — | — | 778(5) | 64,893 | | | 3/2/2021 | — | — | — | — | 390 | 32,530 | — | — | | | 3/2/2022 | 702 | 2,109 | 96.36 | 3/2/2030 | — | — | — | — | | | 3/2/2022 | — | — | — | — | — | — | 1,887(6) | 157,395 | | | 3/2/2022 | — | — | — | — | 708 | 59,054 | — | — | | | 3/2/2022 | — | — | — | — | 2,594 | 216,366 | — | — | | | 3/2/2023 | 3,124 | — | 91.28 | 3/2/2031 | — | — | — | — | | | 3/2/2023 | — | — | — | — | — | — | 2,464(7) | 205,522 | | | 3/2/2023 | — | — | — | — | 1,232 | 102,761 | — | — |

  84. Outstanding Equity Awards at December 31, 2023

    | | | Option Awards | | | | Stock Awards | | | | | Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable(1) | Number of Securities Underlying Unexercised Options (#) Unexercisable(2) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested(3) (#) | Market Value of Shares or Units of Stock That Have Not Vested(4) ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested(4) ($) | | Jeffrey L. Darby | 3/6/2019 | 1,871 | — | 82.03 | 3/6/2027 | — | — | — | — | | | 3/2/2020 | 2,948 | 1,474 | 61.68 | 3/2/2028 | — | — | — | — | | | 3/2/2020 | — | — | — | — | 411 | 34,282 | — | — | | | 3/2/2021 | 998 | 1,000 | 101.45 | 3/2/2029 | — | — | — | — | | | 3/2/2021 | — | — | — | — | — | — | 624(5) | 52,048 | | | 3/2/2021 | — | — | — | — | 312 | 26,024 | — | — | | | 3/2/2022 | 510 | 1,530 | 96.36 | 3/2/2030 | — | — | — | — | | | 3/2/2022 | — | — | — | — | — | — | 1,369(6) | 114,188 | | | 3/2/2022 | — | — | — | — | 513 | 42,789 | — | — | | | 3/2/2022 | — | — | — | — | 2,594 | 216,366 | — | — | | | 3/2/2023 | — | 2,382 | 91.28 | 3/2/2031 | — | — | — | — | | | 3/2/2023 | — | — | — | — | — | — | 1,879(7) | 156,727 | | | 3/2/2023 | — | — | — | — | 939 | 78,322 | — | — | | | 3/2/2023 | — | — | — | — | 1,095 | 91,334 | — | — | | John R. McKnight | 11/1/2019 | 4,748 | — | 73.72 | 11/1/2027 | — | — | — | — | | | 3/2/2020 | 2,184 | 728 | 61.68 | 3/2/2028 | — | — | — | — | | | 3/2/2020 | — | — | — | — | 204 | 17,016 | — | — | | | 3/2/2021 | 974 | 976 | 101.45 | 3/2/2029 | — | — | — | — | | | 3/2/2021 | — | — | — | — | — | — | 609(5) | 50,797 | | | 3/2/2021 | — | — | — | — | 305 | 25,440 | — | — | | | 3/2/2022 | 623 | 1,869 | 96.36 | 3/2/2030 | — | — | — | — | | | 3/2/2022 | — | — | — | — | — | — | 1,673(6) | 139,545 | | | 3/2/2022 | — | — | — | — | 627 | 52,298 | — | — | | | 3/2/2022 | — | — | — | — | 2594 | 216,366 | — | — | | | 3/2/2023 | — | 2,811 | 91.28 | 3/2/2031 | — | — | — | — | | | 3/2/2023 | — | — | — | — | — | — | 2,218(7) | 185,003 | | | 3/2/2023 | — | — | — | — | 1,109 | 92,502 | — | — | | | 3/2/2023 | — | — | — | — | 1.095 | 91,334 | — | — | | Joseph P. Braun | 5/9/2019 | 7,697 | — | 84.93 | 5/9/2027 | — | — | — | — | | | 3/2/2020 | 4,713 | 1,573 | 61.68 | 3/2/2028 | — | — | — | — | | | 3/2/2020 | — | — | — | — | 438 | 36,534 | — | — | | | 3/2/2021 | 1,132 | 1,132 | 101.45 | 3/2/2029 | — | — | — | — | | | 3/2/2021 | — | — | — | — | — | — | 707(5) | 58,971 | | | 3/2/2021 | — | — | — | — | 355 | 29,611 | — | — | | | 3/2/2022 | 618 | 1,856 | 96.36 | 3/2/2030 | — | — | — | — | | | 3/2/2022 | — | — | — | — | — | — | 1,661(6) | 138,544 | | | 3/2/2022 | — | — | — | — | 623 | 51,964 | — | — | | | 3/2/2022 | — | — | — | — | 2,594 | 216,366 | — | — | | | 3/2/2023 | — | 2,811 | 91.28 | 3/2/2031 | — | — | — | — | | | 3/2/2023 | — | — | — | — | — | — | 2,218(7) | 185,003 |

  85. Outstanding Equity Awards at December 31, 2023

    | (1) Represents outstanding and unexercised options which were exercisable at December 31, 2023. |

  86. Outstanding Equity Awards at December 31, 2023

    | (2) Represents outstanding and unexercised options which were unexercisable at December 31, 2023. All options set forth in this column vest in four equal annual installments beginning on the first anniversary of the date of grant. |

  87. Outstanding Equity Awards at December 31, 2023

    | (3) Represents outstanding and unvested time-based stock awards at December 31, 2023. The restricted stock award granted on March 6, 2019 vests at a rate of 1/3 per year beginning on the third anniversary date of the grant. The restricted stock unit awards granted on March 2, 2020, March 2, 2021, March 2, 2022, and March 2, 2023 vest at a rate of 25% per year, beginning on the first anniversary of the date of grant, except that the March 2, 2022 grant of 2,594 restricted stock units for each of Messrs. Hession, Darby, Braun and McKnight vests 100% on the third anniversary of the date of grant and the March 2, 2023 grant of 1,095 restricted stock units for each of Messrs. Darby and McKnight vests 1/3 per year beginning on the first anniversary of the date of grant. |

  88. Outstanding Equity Awards at December 31, 2023

    | (4) Calculated by multiplying the closing price per share of the Company’s common stock on December 29, 2023, $83.41, by the number of shares. |

  89. Outstanding Equity Awards at December 31, 2023

    | (5) Represents performance-based restricted stock unit awards granted in fiscal 2021 for the 2021-2023 performance cycle. Because our performance as of the end of the last fiscal year for this performance cycle has not exceeded the threshold performance measures, these awards are shown at threshold. However, in February 2024, the Compensation Committee determined that the performance measures upon which such awards were to vest were not achieved. As a result, these awards did not vest and have been forfeited. See “Executive Compensation: Compensation Discussion and Analysis – The Components of Named Executive Officer Compensation – Equity Awards” for more information. |

  90. Outstanding Equity Awards at December 31, 2023

    | (6) Represents performance-based restricted stock unit awards granted in fiscal 2022 for the 2022-2024 performance cycle. Because our performance as of the end of the last fiscal year for this performance cycle exceeded the threshold performance measures, these awards are shown at target. However, the amount, if any, of these awards that will be paid out will depend upon the actual performance over the full performance period and the certification of the performance after completion of the performance cycle, which should occur in the first quarter of fiscal year 2025 for the 2022-2024 performance cycle. |

  91. Outstanding Equity Awards at December 31, 2023

    | (7) Represents performance-based restricted stock unit awards granted in fiscal 2023 for the 2023-2025 performance cycle. Because our performance as of the end of the last fiscal year for this performance cycle exceeded the threshold performance measures, these awards are shown at target. However, the amount, if any, of these awards that will be paid out will depend upon the actual performance over the full performance period and the certification of the performance after completion of the performance cycle, which should occur in the first quarter of fiscal year 2026 for the 2023-2025 performance cycle. |

  92. Option Exercises and Stock Vested for Fiscal 2023

    Option Exercises and Stock Vested for Fiscal 2023 The following table provides information about the value realized by the named executive officers upon the exercise of option awards and the vesting of stock awards during the fiscal year ended December 31, 2023:

  93. Option Exercises and Stock Vested for Fiscal 2023

    | | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise(1) ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting(2) ($) | | Kevin M. Olsen | 5,256 | 132,610 | 10,733 | 976,241 | | David M. Hession | — | — | 4,277 | 396,126 | | Jeffrey L. Darby | 943 | 16,899 | 3,688 | 341,690 | | John R. McKnight | — | — | 2,292 | 203,359 | | Joseph P. Braun | — | — | 4,374 | 402,704 |

  94. Option Exercises and Stock Vested for Fiscal 2023

    | (1) The value realized on the exercise of option awards is calculated by determining the difference between the market value of the underlying common stock on the exercise date and the exercise price of the option awards. Reflects the gross amount realized without netting the value of shares surrendered to cover the exercise price and to satisfy tax withholding obligations. |

  95. Option Exercises and Stock Vested for Fiscal 2023

    | (2) The value realized on the vesting of stock awards is calculated by multiplying the number of shares of common stock vested by the market value of the common stock on the vesting date. Reflects the gross amount realized without netting the value of shares surrendered to satisfy tax withholding obligations. |

  96. Non-Qualified Deferred Compensation for Fiscal 2023

    Non-Qualified Deferred Compensation for Fiscal 2023 The following table sets forth the non-qualified deferred compensation activity for each of our named executive officers during the fiscal year ended December 31, 2023 as well as the aggregate non-qualified deferred compensation balances at December 31, 2023. A description of the plan is found under “Executive Compensation: Compensation Discussion and Analysis – The Components of Named Executive Officer Compensation – Non-Qualified Deferred Compensation Plan.”

  97. Non-Qualified Deferred Compensation for Fiscal 2023

    | Name | Executive Contributions in Fiscal 2023(1) ($) | Registrant Contributions in Fiscal 2023 ($) | Aggregate Earnings/Loss in Fiscal 2023 ($) | Aggregate Withdrawals/ Distributions ($) | Aggregate Balance at December 31, 2023(2) ($) | | Kevin M. Olsen | — | — | 100,614 | — | 560,649 | | David M. Hession | — | — | — | — | — | | Jeffrey L. Darby | — | — | 4,947 | (5,042) | 39,576 | | John R. McKnight | 76,784 | — | 23,787 | — | 231,134 | | Joseph P. Braun | 53,958 | — | 35,390 | — | 276,691 |

  98. Non-Qualified Deferred Compensation for Fiscal 2023

    | (1) Represents amounts deferred by each named executive officer to our Non-Qualified Deferred Compensation Plan and reported in the Summary Compensation Table under “Salary” or “Non-Equity Incentive Plan Compensation” for fiscal 2023. |

  99. Non-Qualified Deferred Compensation for Fiscal 2023

    | (2) Amounts reported in the Aggregate Balance at December 31, 2023 which were previously reported as compensation to the named executive officers in the summary compensation tables included in prior SEC filings for previous years included $389,901, $28,125, $51,203 and $197,086 for Messrs. Olsen, Darby, McKnight, and Braun, respectively. These amounts represent executive contributions for prior years. |

  100. Potential Payments upon Termination or Change in Control

    Potential Payments upon Termination or Change in Control In fiscal 2023 upon termination of employment and/or upon a change in control, our named executive officers would have been entitled to receive from us potential payments and benefits under the following agreements and plans:

  101. Potential Payments upon Termination or Change in Control

    | ■ | employment agreement (in the case of Mr. Olsen); |

  102. Potential Payments upon Termination or Change in Control

    | ■ | our Severance Plan; |

  103. Potential Payments upon Termination or Change in Control

    | ■ | our 2018 Equity Plan; |

  104. Potential Payments upon Termination or Change in Control

    | ■ | our 2018 Cash Plan; and |

  105. Potential Payments upon Termination or Change in Control

    | ■ | our Non-Qualified Deferred Compensation Plan. |

  106. Non-Qualified Deferred Compensation Plan

    Non-Qualified Deferred Compensation Plan Our Non-Qualified Deferred Compensation Plan provides that a participant is 100% vested as to amounts deferred by the participant plus any earnings or losses on the investment of such deferrals. Deferred amounts will be distributed, either in lump sum or in equal installments up to five years depending upon the participant’s balance, upon the occurrence of (i) the first day of the seventh month after separation of employment; (ii) death; or (iii) disability (as defined by Section 409A of the Code). The amounts payable pursuant to the non-qualified deferred compensation plan to Messrs. Olsen, Darby, McKnight, and Braun in connection with a termination of employment as of December 31, 2023 would have been $560,649, $39,576, $231,134 and $276,691, respectively. With respect to Messrs. McKnight and Braun, assumes the Compensation Committee paid their fiscal 2023 annual cash bonus awards in accordance with the terms of the Severance Plan and that they deferred a portion thereof into the Non-Qualified Deferred Compensation Plan.

  107. Potential Payments upon Termination in the non-Change-in-Control Context

    Potential Payments upon Termination in the non-Change-in-Control Context The table below shows the estimated amount of payments and benefits that (i) Mr. Olsen would have been eligible to receive pursuant to his employment agreement and (ii) each of the other named executive officers would have been eligible to receive pursuant to the Severance Plan, in addition to the treatment of all of their respective equity awards outstanding under 2018 Equity Plan and its related award agreements, if their employment was terminated as of December 31, 2023 by the Company without cause or by them with good reason, but assuming a change-in-control had not occurred.

  108. Potential Payments upon Termination in the non-Change-in-Control Context

    | Named Executive Officer | Cash Payment in Lieu of Salary and Target Annual Bonus(1) ($) | Cost of Continuation of Health Benefits (2) ($) | Value of Accelerated Restricted Stock and Restricted Stock Units(3) ($) | Pro-Rated Actual Cash Incentive Award(4) ($) | Out- placement Services(5) ($) | Total(6) ($) | | Kevin M. Olsen | 2,700,000 | 45,409 | 169,406 | 603,000 | 50,000 | 3,567,815 | | David M. Hession | 850,000 | 30,272 | — | 234,500 | 50,000 | 1,164,772 | | Jeffrey L. Darby | 732,160 | 30,101 | — | 318,490 | 50,000 | 1,130,751 | | John R. McKnight | 765,000 | 26,811 | — | 214,200 | 50,000 | 1,056,011 | | Joseph P. Braun | 765,000 | 30,272 | — | 211,050 | 50,000 | 1,056,322 |

  109. Potential Payments upon Termination in the non-Change-in-Control Context

    | (1) Represents 150% of Mr. Olsen’s base salary in effect as of the assumed termination date, payable over a period of eighteen (18) months, plus 150% of Mr. Olsen’s target annual bonus award in effect as of the assumed termination date, payable in a lump sum sixty (60) days after the date of termination. With respect to the other named executive officers, represents 100% of each named executive officer’s base salary plus each named executive officer’s target annual cash bonus award in effect as of the assumed termination date and is payable over a period of twelve months. |

  110. Potential Payments upon Termination in the non-Change-in-Control Context

    | (2) Assumes no increase in premiums and covers (i) in the case of Mr. Olsen, a period of up to eighteen months following the assumed termination date, and (ii) in the case of each of the other named executive officers, a period of up to twelve months following the assumed termination date. |

  111. Potential Payments upon Termination in the non-Change-in-Control Context

    | (3) Represents the value realized on the vesting of all unvested time-based restricted stock issued to Mr. Olsen in fiscal 2019, which value is determined by multiplying $83.41, which was the closing price of our common stock on December 29, 2023, the trading day immediately preceding the assumed termination date, by the number of shares of unvested restricted stock subject to such awards as of such date. |

  112. Potential Payments upon Termination in the non-Change-in-Control Context

    | (4) Pursuant to Mr. Olsen’s employment agreement and the Severance Plan, as applicable, represents a pro-rated amount of the annual bonus that the named executive officer would have otherwise received under the 2018 Cash Plan had he remained employed with the Company as of the assumed termination date. Because this amount is being calculated as of December 31, 2023, the amount shown reflects the actual payout to the named executive officer in March 2024 of his fiscal 2023 annual cash bonus award under the 2018 Cash Plan. |

  113. Potential Payments upon Termination in the non-Change-in-Control Context

    | (5) Represents the maximum amount permitted under the Severance Plan. Although he is not a participant under the Severance Plan, under his employment agreement Mr. Olsen would be entitled to reasonable outplacement services for a period of up to eighteen months following the date of his termination. While the employment agreement does not place a cap on such outplacement services, we have assumed for this exercise that the costs would not exceed the maximum amount payable to our other named executive officers who are participants in the Severance Plan. |

  114. Potential Payments upon Termination in the non-Change-in-Control Context

    | (6) For our named executive officers, in addition to the amounts shown, Mr. Olsen’s employment agreement and the Severance Plan respectively provide that they would be entitled to receive their Accrued Obligations. For purposes of this analysis, we have assumed that the Accrued Obligations for each named executive officer were paid prior to the hypothetical termination date of December 31, 2023. |

  115. Potential Payments upon Termination in the Change-in-Control Context

    Potential Payments upon Termination in the Change-in-Control Context The table below shows the estimated amount of payments and benefits that (i) Mr. Olsen would have been eligible to receive pursuant to his employment agreement and (ii) each of the other named executive officers would have been eligible to receive pursuant to the Severance Plan, in addition to the treatment of all of their respective equity awards outstanding under the 2018 Equity Plan and the standard award agreements under such plan, if their employment was terminated as of December 31, 2023 by the Company without cause or by them with good reason, in the context of the occurrence of a change-in-control.

  116. Potential Payments upon Termination in the Change-in-Control Context

    | Named Executive Officer | Cash Payment in Lieu of Salary and Target Annual Bonus(1) ($) | Cost of Continuation of Health Benefits(2) ($) | Value of Accelerated Restricted Stock and Restricted Stock Units(3) ($) | Value of Accelerated Stock Options(4) ($) | Pro-Rated Actual Cash Incentive Award(5) ($) | Out- placement Services(6) ($) | Total(7) ($) | | Kevin M. Olsen | 3,600,000 | 60,545 | 6,014,695 | 63,560 | 603,000 | 50,000 | 10,391,800 | | David M. Hession | 1,700,000 | 45,409 | 1,435,403 | 36,637 | 234,500 | 50,000 | 3,501,949 | | Jeffrey L. Darby | 1,464,320 | 45,152 | 1,239,139 | 32,030 | 318,490 | 50,000 | 3,149,131 | | John R. McKnight | 1,530,000 | 40,217 | 1,347,238 | 15,819 | 214,200 | 50,000 | 3,197,474 | | Joseph P. Braun | 1,530,000 | 45,409 | 1,309,954 | 34,181 | 211,050 | 50,000 | 3,180,594 |

  117. Potential Payments upon Termination in the Change-in-Control Context

    | (1) Represents 200% of Mr. Olsen’s base salary plus 200% of Mr. Olsen’s target annual cash bonus award in effect as of the assumed termination date and is payable in a lump sum sixty (60) days after the date of termination. With respect to the other named executive officers, represents 200% of each named executive officer’s base salary plus 200% of each named executive officer’s target annual cash bonus award in effect as of the assumed termination date and is payable in a lump sum sixty (60) days after the date of termination. |

  118. Potential Payments upon Termination in the Change-in-Control Context

    | (2) Assumes no increase in premiums and covers (i) in the case of Mr. Olsen, a period of up to twenty-four months following the assumed termination date, and (ii) in the case of each of the other named executive officers, a period of up to eighteen months following the assumed termination date. |

  119. Potential Payments upon Termination in the Change-in-Control Context

    | (3) Represents the value realized on the acceleration of the vesting of all unvested restricted stock and restricted stock units issued pursuant to the 2018 Equity Plan assuming a change in control occurred on December 31, 2023. Such value is calculated by multiplying $83.41, which was the closing price of our common stock on December 29, 2023, the trading day immediately preceding the assumed termination date, by the number of shares of unvested restricted stock and restricted stock units as of such date. The value realized on the acceleration of the vesting of all unvested performance-based restricted stock and restricted stock units is calculated based upon the maximum level attainment. |

  120. Potential Payments upon Termination in the Change-in-Control Context

    | (4) Represents the value realized on the acceleration of vesting of all in-the-money unvested stock options, which value is determined for each unvested stock option by multiplying the number of shares underlying such stock option by the difference between $83.41, which was the closing price of our common stock on December 29, 2023, the trading day immediately preceding the assumed termination date, and the exercise price for such stock option. |

  121. Potential Payments upon Termination in the Change-in-Control Context

    | (5) Pursuant to Mr. Olsen’s employment agreement and the Severance Plan, as applicable, represents a pro-rated amount of the annual bonus that the named executive officer would have otherwise received under the 2018 Cash Plan had he remained employed with the Company as of the assumed termination date. Because this amount is being calculated as of December 31, 2023, the amount shown reflects the actual payout to the named executive officer in March 2023 of his fiscal 2023 annual cash bonus award under the 2018 Cash Plan. |

  122. Potential Payments upon Termination in the Change-in-Control Context

    | (6) Represents the maximum amount permitted under the Severance Plan. Although he is not a participant under the Severance Plan, under his employment agreement, Mr. Olsen would be entitled to reasonable outplacement services for a period of up to eighteen months following the date of his termination. While the employment agreement does not place a cap on such outplacement services, we have assumed for this exercise that the costs would not exceed the maximum amount payable to our other named executive officers who are participants in the Severance Plan. |

  123. Potential Payments upon Termination in the Change-in-Control Context

    | (7) In addition to the amounts shown, each of the named executive officers would be entitled to receive his Accrued Obligations. For purposes of this analysis, we have assumed that the Accrued Obligations for each named executive officer were paid prior to the hypothetical termination date of December 31, 2023. |

  124. Potential Payments Upon Change-in-Control (No Termination)

    Potential Payments Upon Change-in-Control (No Termination) The following table shows the estimated maximum amount of payments and benefits which our named executive officers would have been entitled to upon a change in control of the Company that occurred on December 31, 2023 pursuant to our 2018 Equity Plan and the standard award agreements under such plan. Such amounts would be payable even if the named executive officers remained employed by the Company as of such date.

  125. Potential Payments Upon Change-in-Control (No Termination)

    | Name | Value of Accelerated Vesting of Stock Awards(1) ($) | Value of Accelerated Vesting of Stock Option Awards(2) ($) | Total ($) | | Kevin M. Olsen | 6,014,695 | 63,560 | 6,078,255 | | David M. Hession | 1,435,403 | 36,637 | 1,472,040 | | Jeffrey L. Darby | 1,239,139 | 32,030 | 1,271,169 | | John R. McKnight | 1,347,238 | 15,819 | 1,363,057 | | Joseph P. Braun | 1,309,954 | 34,181 | 1,344,135 |

  126. Potential Payments Upon Change-in-Control (No Termination)

    | (1) Represents the value realized on the acceleration of the vesting of all unvested restricted stock and restricted stock units issued pursuant to the 2018 Equity Plan assuming a change in control occurred on December 31, 2023. Such value is calculated by multiplying $83.41, which was the closing price of our common stock on December 29, 2023, the trading day immediately preceding the assumed termination date, by the number of shares of unvested restricted stock and restricted stock units as of such date. The value realized on the acceleration of the vesting of all unvested performance-based restricted stock and restricted stock units is calculated based upon the maximum level attainment. |

  127. Potential Payments Upon Change-in-Control (No Termination)

    | (2) Represents the value realized on the acceleration of vesting of all in-the-money unvested stock options, which value is determined for each unvested stock option by multiplying the number of shares underlying such stock option by the difference between $83.41, which was the closing price of our common stock on December 29, 2023, the trading day immediately preceding the assumed termination date, and the exercise price for such stock option. |

  128. Potential Payments upon Death or Disability

    Potential Payments upon Death or Disability The table below shows the estimated amount of payments and benefits that (i) Mr. Olsen would have been eligible to receive pursuant to his employment agreement and (ii) each of the other named executive officers would have been eligible to receive pursuant to the Severance Plan, in addition to the treatment of all of their respective equity awards outstanding under 2018 Equity Plan and its related award agreements, if their employment was terminated as of December 31, 2023 as a result of death or disability.

  129. Potential Payments upon Death or Disability

    | Named Executive Officer | Salary Continuation Benefits(1) ($) | Value of Accelerated Restricted Stock and Restricted Stock Units(2) ($) | Value of Accelerated Stock Options(3) ($) | Pro-Rated Actual Cash Incentive Award(4) ($) | Total(5) ($) | | Kevin M. Olsen | 225,000 | 2,621,409 | 63,560 | — | 2,909,969 | | David M. Hession | — | 753,220 | 36,637 | 234,500 | 1,024,357 | | Jeffrey L. Darby | — | 721,580 | 32,030 | 318,490 | 1,072,100 | | John R. McKnight | — | 751,246 | 15,819 | 214,200 | 981,265 | | Joseph P. Braun | — | 698,948 | 34,181 | 211,050 | 944,179 |

  130. Potential Payments upon Death or Disability

    | (1) Represents 3 months of continued base salary payments for Mr. Olsen. |

  131. Potential Payments upon Death or Disability

    | (2) Represents the value realized upon the acceleration of the vesting of (i) all unvested time-based restricted stock and restricted stock units, and (ii) a pro rata portion of all unvested performance-based restricted stock and restricted stock units issued under our 2018 Equity Plan, which value is calculated by multiplying $83.41, which was the closing price of our common stock on December 29, 2023, the trading day immediately preceding the assumed termination date, by the number of shares of unvested restricted stock and restricted stock units. The value realized on the acceleration of the vesting of all unvested performance-based restricted stock and restricted stock units issued under our 2018 Equity Plan is calculated assuming the performance conditions related to such stock awards were satisfied at the target level of performance. The performance-based restricted stock and restricted stock units issued pursuant to the 2018 Equity Plan would not be settled until the Compensation Committee certifies the performance after completion of the applicable performance cycle. |

  132. Potential Payments upon Death or Disability

    | (3) Represents the value realized on the acceleration of vesting of all in-the-money unvested stock options, which value is determined for each unvested stock option by multiplying the number of shares underlying such stock option by the difference between $83.41, which was the closing price of our common stock on December 29, 2023, the trading day immediately preceding the assumed termination date, and the exercise price for such stock option. |

  133. Potential Payments upon Death or Disability

    | (4) Pursuant to the Severance Plan, represents a pro-rated amount of the annual bonus that the named executive officer would have otherwise received under the 2018 Cash Plan had he remained employed with the Company as of the assumed termination date. Because this amount is being calculated as of December 31, 2023, the amount shown reflects the actual payout to the named executive officer in March 2024 of his fiscal 2023 annual cash bonus award under the 2018 Cash Plan. |

  134. Potential Payments upon Death or Disability

    | (5) In addition to the amounts shown, each of the named executive officers would be entitled to receive his Accrued Obligations. For purposes of this analysis, we have assumed that the Accrued Obligations for each named executive officer were paid prior to the hypothetical termination date of December 31, 2023. |

  135. Potential Payments upon Death or Disability

    Pay Ratio The following describes the relationship of the annual total compensation of Dorman employees to the annual total compensation of Kevin M. Olsen, our Chief Executive Officer, during fiscal 2023. For fiscal 2023, the median of the annual total compensation of all of our employees, other than Mr. Olsen, was $45,713. Mr. Olsen’s annual total compensation for fiscal 2023 was $4,219,066. This represents the amount reported in the fiscal 2023 Total column of the Summary Compensation Table above. In determining the annual total compensation of the median employee, such employee’s compensation was calculated in accordance with the SEC executive compensation disclosure rules. Given the different methodologies that various public companies may use to determine an estimate of their pay ratio, the estimated ratio reported below should not be used as a basis for comparison between companies. SEC rules allow us to identify our median employee once every three years unless there has been a change in our employee population or employee compensation arrangements that we reasonably believe would result in a significant change in our pay ratio disclosure. Following our acquisition of Super ATV, LLC in October 2022, which included 572 employees globally, of which 153 were located in China, and upon completion of the integration of that business during 2023, we believed it was appropriate to determine a new median employee for 2023. As of October 31, 2023, when we determined our median employee, our employee population consisted of approximately 3,872 individuals, with 3,547 employees in the United States, 50 employees in Canada, 225 employees in China, 8 employees in Taiwan and 42 employees in India. The pay ratio disclosure rules provide an exemption for companies to exclude non-U.S. employees from the median employee calculation if non-U.S. employees account for 5% or less of its total U.S. and non-U.S. employees. In addition, a registrant with more than 5% non-U.S. employees may also exclude non-U.S. employees up to the 5% threshold; provided that, if such a registrant excludes any non-U.S. employees in a particular foreign jurisdiction, it must exclude all the employees in that jurisdiction. We applied this de minimis exemption when identifying the median employee by excluding 50 employees in Canada, 8 employees in Taiwan and 42 employees in India. Therefore, for purposes of identifying our median employee, our employee population, after taking into consideration the adjustments permitted by SEC rules (as described above), consisted of approximately 3,772 employees, 3,547 based in the United States and 225 based in China. For purposes of identifying the median employee from this data set, we reviewed total actual cash compensation earned by each US and China employee, excluding Mr. Olsen, who were employed by us on October 31, 2023. We utilized total cash compensation converted into US dollars using an exchange rate of USD/CNY of 0.1367 on October 31, 2023, as we believe that total cash compensation represented the best measure of all compensation earned by each US and China employee. We included all employees, whether employed on a full-time, part-time, or seasonal basis, and we did not annualize the compensation of any employees who were employed for less than the full measurement period. Using this methodology, we determined that our median employee was a full-time, hourly employee. In determining the annual total compensation of the median employee, such employee’s compensation was calculated in accordance with the SEC executive compensation disclosure rules. As illustrated in the table below, our 2023 CEO to median employee pay ratio is 92.3:1.

  136. Potential Payments upon Death or Disability

    | | CEO to Median Employee Pay Ratio | | | | President and CEO ($) | Median Employee ($) | | Base Salary | 884,513 | 40,156 | | Bonus | — | 3,151 | | Stock Awards | 2,087,453 | — | | Option Awards | 599,999 | — | | Non-Equity Incentive Plan Compensation | 603,000 | — | | All Other Compensation | 44,101 | 2,406 | | Total | 4,219,066 | 45,713 |

  137. Potential Payments upon Death or Disability

    Pay vs. Performance The following table shows (i) the total compensation for our chief executive officer and, on an average basis, total compensation for our other named executive officers as set forth in the Summary Compensation Table (“SCT”); (ii) the “compensation actually paid” to our chief executive officer and, on an average basis, compensation actually paid to our other named executive officers (in each case, as determined under applicable SEC rules); (iii) our TSR; (iv) the TSR of the NASDAQ US Benchmark Auto Parts Index over the same period, (v) our net income and (vi) our adjusted pre-tax income, which is the most important financial measure that we used to link compensation actually paid to the named executive officers for 2023 to Company performance. Compensation actually paid, as determined under SEC requirements, does not reflect the actual amount of compensation earned by or paid to our named executive officers during a covered year. No dividends were paid or accrued on stock awards for the years presented.

  138. Potential Payments upon Death or Disability

    | | | | | | Value of Initial Fixed $100 Investment Based On: | | | | | Year | SCT Total Compensation for CEO(1) ($) | Compensation Actually Paid to CEO(1,3) ($) | Average SCT Total Compensation for Other NEOs(2) ($) | Average Compensation Actually Paid to Other NEOs(2,3) ($) | TSR (Company)(4) ($) | TSR (Peer Group)(4) ($) | Net Income(5) ($ in thousands) | Adjusted Pre-Tax Income(6) ($ in thousands) | | 2023 | 4,219,066 | 2,841,119 | 1,226,892 | 989,472 | 111.00 | 104.00 | 129,259 | 187,025 | | 2022 | 3,079,982 | 1,006,154 | 1,142,856 | 508,834 | 108.00 | 108.00 | 121,549 | 189,800 | | 2021 | 3,377,508 | 4,229,896 | 1,255,441 | 1,684,833 | 142.00 | 139.00 | 131,532 | 182,700 | | 2020 | 2,238,694 | 2,707,653 | 1,244,728 | 1,580,887 | 119.00 | 114.00 | 106,870 | 143,050 |

  139. Potential Payments upon Death or Disability

    | (1) Mr. Olsen served as president and chief executive officer for each of the years presented in the table. |

  140. Potential Payments upon Death or Disability

    | (2) The other named executive officers for each of the years presented in the table were as follows: for fiscal 2023 and 2022, Messrs. Braun, Darby, Hession, and McKnight; for fiscal 2021, Messrs. Berman, Braun and Hession and Mr. Michael B. Kealey, our then-Executive Vice President, Commercial; and, for fiscal 2020, Messrs. Braun, Darby, Hession and Kealey. |

  141. Potential Payments upon Death or Disability

    | (3) SEC rules require certain adjustments be made to the SCT total compensation to determine “compensation actually paid” for purposes of the Pay vs. Performance Table, which are detailed in the table below. None of our named executive officers participate in a defined benefit plan, and so no adjustment for pension benefits is included in the table below. The following table details these adjustments for fiscal 2023: |

  142. Potential Payments upon Death or Disability

    | Adjustments | FY2023 | | | | CEO ($) | Other NEOs Average ($) | | Total from SCT | 4,219,066 | 1,226,892 | | Adjustments for stock and options awards | | | | Subtract: Grant date fair value of Stock and Option Awards(a) | (2,687,452) | (498,649) | | +: Fair value(b) of equity awards granted during the fiscal year, unvested as of fiscal year-end | 1,914,193 | 365,229 | | +/-: Change in fair value(b) of unvested equity awards granted in prior years and outstanding at beginning and end of fiscal year | (714,588) | (133,017) | | +/-: Change in fair value(b) for equity awards granted in prior years that vested in the fiscal year | 109,900 | 29,017 | | -: Fair value(b) of equity awards that were forfeited in the fiscal year | — | — | | Total Impact: Adjustments for stock and option awards | (1,377,947) | (237,420) | | Compensation Actually Paid (as calculated) | 2,841,119 | 989,472 |

  143. Potential Payments upon Death or Disability

    | (a) The amounts reported in this row represent the grant date fair value of equity awards reported in the “Stock Awards” and “Option Awards” columns of the SCT for the applicable year. |

  144. Potential Payments upon Death or Disability

    | (b) We used a Monte Carlo simulation model to determine the grant date fair value of the 2021, 2022, and 2023 performance-based restricted stock awards that would vest based on the Company’s TSR and revalued those awards on December 31, 2023. The remeasured fair value of the 2021, 2022 and 2023 awards was $84.90, $23.55, and $73.03 per share as of December 31, 2023. |

  145. Potential Payments upon Death or Disability

    The assumptions used to calculate the fair value of stock options did not differ materially from those used to calculate grant date fair value for such awards; we used the Black-Scholes option valuation model to determine fair value as of the applicable year-end or vesting date(s), based on the same methodology previously used to determine grant date fair value, except that we used (a) the closing stock price on the applicable revaluation date as the current fair market value and (b) a reduced expected life, given applicable time lapsed since grant date.

  146. Potential Payments upon Death or Disability

    | (4) TSR is determined based on the value of an initial fixed investment of $100 in common stock at December 31, 2019, assuming the reinvestment of dividends. The TSR peer group is the NASDAQ US Benchmark Auto Parts Index, as identified in Part II. Item 5 of the Company’s Form 10-K filed with the SEC on February 28, 2024 (the “10-K Peer Group”). |

  147. Potential Payments upon Death or Disability

    | (5) Net income is calculated in accordance with GAAP and as reported in the Company’s Form 10-K filed with the SEC on February 28, 2024. |

  148. Potential Payments upon Death or Disability

    | (6) “Adjusted Pre-Tax Income” means the Company’s consolidated income before income taxes determined in accordance with GAAP, excluding the following items: (a) items generally excluded from earnings per share and earnings before interest, taxes, depreciation and amortization, or EBITDA, by the Company or institutional investors or analysts when evaluating the Company’s performance, such as one-time gains or losses from asset sales, dispute or litigation charges or recoveries, impairment charges, acts of God, restructuring charges and other non-GAAP adjustments, but including normal provisions for slow moving and obsolete inventory and accounts receivable; (b) the impact of any acquisitions, divestitures, discontinuance of business operations, or restructuring; and (c) the cumulative effect of any accounting changes. |

  149. Potential Payments upon Death or Disability

    While the Company uses numerous financial and nonfinancial performance measures for the purpose of evaluating performance for the Company’s compensation programs, the Company has determined that Adjusted Pre-Tax Income is the financial performance measure that, in the Company’s assessment, represents the most important performance measure (that is not otherwise required to be disclosed in the table) used by the Company to link compensation paid to the Company’s named executive officers, for the most recently completed fiscal year, to Company performance.