our principal executive officer, principal financial officer or principal accounting officer of the Company that requires disclosure under applicable SEC rules, the Company intendswe intend to disclose such amendment or waiver and the reasons therefor on a Current Report on Form 8-K or on its next periodic report filed under the Exchange Act.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

        The Compensation Committee during fiscal 20152016 was composed of Ronald S. Poelman, Chairman, Robert AnciauxD. Richard Williams, Chair, Feng Peng and Jerry G. McClain.Frederic Winssinger. All members of the Compensation Committee are independent directors. None of the members of our Compensation Committee has ever been an officer or employee of the Company or any of our subsidiaries. None of the members of our Compensation Committee had any relationship requiring disclosure under "Transactions with Related Persons." During fiscal 2015, there were no relationshipsyear 2016, none of our executive officers served as a director or transactions between the Company and any member of the Compensation Committee requiring disclosure hereunder.compensation committee (or other committee of the board of directors performing equivalent functions) of another entity that had an executive officer serving on our Board of Directors.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

        Section 16(a) of the Exchange Act requires our officers, directors, and persons who beneficially own more than 10% of our common stock to file reports of ownership and changes in ownership with the SEC. These parties are also required by the SEC to furnish us with copies of all Section 16(a) forms that they file.

        Based solely upon a review of these forms that were furnished to us, and based on representations made by certain persons who were subject to this obligation that such filings were not required to be made, the Company believes that all reports that are required to be filed by these individuals and persons under Section 16(a) were filed on time in fiscal year 2016, except that one filing on Form 4 for Gilbert A. Fuller was filed late.

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EXECUTIVE OFFICERS

        The executive officers of USANA at January 2,December 31, 2016, and as of the date of this Proxy Statement were:

        The following information is provided for each ofto us by our executive officers.

David A. Wentz, 45, Co-Chief Executive Officer. Mr. Wentz joined USANA as a part-time employee in 1992. He has been a full-time employee since March 1994. From 1993 until April 2004, he was a member of the Company's Board of Directors. Mr. Wentz was appointed Chief Executive Officer in July 2008 and served in this capacity until August 2015 when he was appointed Co-Chief Executive Officer. He served as President from July 2002 to July 2008 and previously served as the Company's Executive Vice President from October 2001 to July 2002. He served as the Company's Senior Vice President of Strategic Development from June 1999 to October 2001, and as the Company's Vice President of Strategic Development from August 1996 to June 1999. Mr. Wentz received a B.S. in Bioengineering from the University of California, San Diego. Mr. Wentz is the son of Dr. Wentz, who is the founder of the Company and Chairman of the Company's Board of Directors.

        Kevin G. Guest, 53, Co-Chief54, Chief Executive Officer. Mr. Guest joined USANA on a part-time basis in April 2003, as Executive Director of Media and Events. Following the Company's acquisition of FMG Productions, a media, video, and event productions company that was founded by Mr. Guest, he became a full-time employee of the Company and was promoted to Vice President of Media and Events in February 2004. In January 2006, he was appointed as the Company's Executive Vice President of Marketing and served in that role until July 2008, when he was appointed Chief Marketing Officer. Mr. Guest served in this role until May 2011, when he was appointed as President of North America. In October 2012, he was appointed as President of the Americas, Europe and South Pacific. In August 2014, Mr. Guest was appointed President of the Company and served in this role until August 2015, when he was appointed Co-Chief Executive Officer. He served in this role until November 2016 when he was appointed Chief Executive Officer. Prior to joining USANA full-time, from 1992 to February 2004, Mr. Guest served as the Managing Partner of FMG Productions. Mr. Guest earned a B.A. in Communications from Brigham Young University.

TableJim Brown, 48, President and Chief Operating Officer. Mr. Brown joined USANA in 2006 as Vice President of ContentsOperations. In July 2011, he was appointed Vice President of Global Operations and served in that role until July 2012, when he was appointed Chief Production Officer. He served in that role until November 2013 when he was appointed Chief Operating Officer. He served in that role until November 2016 when he was appointed President and Chief Operating Officer. Prior to joining USANA, Mr. Brown was employed at Sonoco as a plant manager where he was responsible for safety, quality, finance, production, and maintenance. Mr. Brown received a bachelor's degree with a double major in computer science and math as well as an M.B.A. from Francis Marion University in Florence, South Carolina.

        Paul A. Jones, 52,53, Chief Financial Officer and Chief Leadership Development Officer. Mr. Jones joined USANA in 2005 as Vice President of Human Resources and served in this role until June 2007, when he left to complete a three year service mission. Mr. Jones returned to USANA as Vice President of Human Resources in July 2010 and served in this role until December 2012, when he was appointed Chief Financial Officer. In August 2015, Mr. Jones was also appointed Chief Leadership Development Officer. Prior to joining USANA, Mr. Jones was employed as Vice President of Human Resources and later as Vice President of Operations for Associated Food Stores, Inc. Mr. Jones received a B.S. in finance from Utah State University and a master of arts in organizational management from the University of Phoenix. Mr. Jones is also a Certified Management Accountant.

        Deborah Woo, 62, President of Asia. Mrs. Woo joined USANA as General Manager of USANA Hong Kong in 1999 and served in that role until 2003. In 2003, she was promoted to Regional General Manager and became responsible for the Hong Kong, Taiwan, and Singapore markets. Mrs. Woo was subsequently promoted to Vice President of Greater China and East Asia in 2005. As a result of USANA's strategic regional alignment in 2007, Mrs. Woo was appointed as Vice President of Greater China and North Asia. In 2008, Mrs. Woo was promoted to Executive Vice President of Asia. In February 2010, Mrs. Woo was promoted to Executive Vice President of Sales and served in this role until May 2011, when she was appointed President of Asia Pacific. In October 2012, she was appointed President of Asia and Greater China and served in this capacity until she was appointed President of Asia in January 2016. Mrs. Woo entered the direct selling industry in 1990 as a Distributor Relations Manager for Amway Hong Kong. She later became Director of Sales for Caring International (Hong Kong) Limited in 1996 where she headed up multifunctional teams in operations, distributor relations, and marketing.

James H. Bramble, 46,47, Chief Legal Officer and Corporate Secretary. Mr. Bramble joined USANA in March 1998 to manage the Compliance and Legal Departments. In April 2006 he was appointed Vice President and General Counsel. In July 2008, Mr. Bramble was also appointed Corporate

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Secretary, and served in these roles until May 2011, when he was appointed Chief Legal Officer and Corporate Secretary. Prior to joining USANA, Mr. Bramble was employed with Novus Services. Mr. Bramble received a B.S. in political science with a minor in Spanish from the University of Utah in Salt Lake City, Utah. He received his J.D. from the S.J. Quinney College of Law at the University of Utah.

Jim Brown, 47, Chief Operating Officer. Mr. Brown joined USANA in 2006 as Vice President of Operations. In July 2011, he was appointed Vice President of Global Operations and served in that role until July 2012, when he was appointed Chief Production Officer. He served in that role until November 2013 when he was appointed Chief Operating Officer. Prior to joining USANA, Mr. Brown was previously employed at Sonoco as a plant manager where he was responsible for safety, quality, finance, production, and maintenance. Mr. Brown received a bachelor's degree with a double major in computer science and math as well as an M.B.A. from Francis Marion University in Florence, South Carolina.

        Daniel A. Macuga, Jr., 46, Chief Communications Officer and Executive Vice President of Field Development for the Americas.Officer. Mr. Macuga joined USANA in 2007 as Vice President of Network Development and Public Relations. In July 2008, he was appointed as Vice President of Marketing, Public Relations and Social Media and served in that role until December 2011, when he was appointed Chief Communications Officer. He served in that role until February 2014 when he was appointed Chief Communications Officer and Executive Vice President of Field Development for the Americas. He served in that role until November 2016 when he was appointed Chief Communications Officer. Prior to joining USANA, Mr. Macuga was employed at the Chrysler Corporation, where he spent 15 years working closely with independent dealership entrepreneurs to help them build their businesses, increase awareness for their products, and keep them focused on effective customer relationship management. Mr. Macuga received a B.A. in communications from the University of California, San Diego.

Robert A. Sinnott, M.N.S., Ph.D., 52, joined USANA as our Chief Scientific Officer in August 2016. From 2005 to 2016, he was Chief Science officer of Mannatech, Inc. From 2009 to 2012 he also served as Co-CEO and from 2012 to 2016 as CEO of Mannatech. During his tenure at Mannatech, Dr. Sinnott has served to further the company's proprietary science, research and development, and initiated independent clinical trials, was responsible for oversight of quality assurance/quality control, global regulatory affairs, legal department, human resources, and global supply chain. Dr. Sinnott has held scientific and business positions in both industry and government over the past 25 years with experience in life sciences, chemistry, biotechnology and nutrition. For the past 18 years, he has worked directly in the dietary supplement industry both in the United States and internationally. From 2006 to 2011, Dr. Sinnott held a seat on the Board of Directors of the Council of Responsible Nutrition's (the "CRN"), the leading trade association representing ingredient suppliers and manufacturers of dietary supplements. From 2009 to 2011, Dr. Sinnott also served as chair of the Senior Scientific Advisory Committee (SSAC) for the CRN. The SSAC is comprised of the highest-ranking scientific officers of member companies. Its role is to assist the CRN with development and implementation of scientific strategy relating to scientific publications, scientific policies and programs by government agencies. Dr. Sinnott holds a B.S. degree in Biological Sciences, a Masters in Natural Science, and a Ph.D. in Plant Sciences from Arizona State University, in Tempe, Arizona. His focus was on applied biological sciences, including biotechnology and plant medicinal chemistry.

Walter Noot, 51, joined USANA as Chief Information Officer in December 2016. Mr. Noot has more than two decades of executive leadership experience and has worked with a wide range of businesses in many industries, from start-ups to multibillion-dollar companies. From 2014 until 2016, he was an executive officer of Young Living Essential Oils, LC, where he served as Chief Information Officer and Senior Vice President of Operations before joining USANA. While at Young Living he oversaw improvements to the supply chain, implementation of a new ERP, and a software systems rebuild. Prior to joining Young Living, Mr. Noot was COO of MonaVie, another direct sales company from 2012 to 2014 and has held leadership positions with Computer Associates, Canon (Oce), and Onyx Graphics. He holds a B.S. degree in mechanical engineering from Brigham Young University.

David Mulham, 57, Chief Field Development Officer. Mr. Mulham joined USANA in 2009 as Field Development, Marketing and Customer Service Manager for Australia and New Zealand. In February 2011, he was appointed General Manager, for Australia and New Zealand and served in that role until June 2011, when he was appointed Vice President, Pacific Region (Australia, New Zealand and Philippines). In February 2014 he was appointed Executive Vice President of Field Development, Pacific Region and then in May 2015 he was appointed Executive Vice President, Pacific Region. He

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served in that role until January 2016 when he was appointed Executive Vice President, Pacific and Europe and then in September 2016, he was appointed Executive Vice President, the Americas, Pacific and Europe. He served in that role until February 2017, when he was appointed Chief Field Development Officer. Prior to joining USANA, Mr. Mulham had extensive experience in the Direct Selling Industry having worked for Amway, Mary Kay, Nutri Metics and Dorling Kindersley Family Learning. He subsequently worked in property development as Director of both Hunter Valley Gardens and Tempus Two Winery. Mr. Mulham has a post graduate diploma from Macquarie Graduate School of Management, Sydney, and received the Silver Stevie Award in 2015, for Executive of the Year—Health Products & Services and Pharmaceuticals.

PROPOSAL #1—ELECTION OF DIRECTORS

        Our Bylaws provide that the shareholders or the Board of Directors shall determine the number of directors from time to time, but that there shall be no less than three directors. The Board of Directors, by resolution, has set the number of directors at seven. The Governance, Risk and Nominating Committee of the Board of Directors has nominated seven persons for election to the Board of Directors. Six incumbent directors will stand for re-election: Myron W. Wentz, Ph.D., Gilbert A. Fuller, Robert Anciaux, D. Richard Williams, Frederic Winssinger and Feng Peng. In addition, the Governance, Risk and Nominating Committee has nominated our Chief Executive Officer, Kevin Guest, to stand for election to the Board.

        The Governance, Risk and Nominating Committee believes that all directors must, at a minimum, meet the criteria set forth in the USANA Corporate Governance Guidelines and in the Charter of the Governance, Risk and Nominating Committee, which specify, among other things, that the committee will consider criteria such as the director's independence, expertise and experience applicable to our business, substantive knowledge of our industry, high personal and professional ethics and the ability and willingness to devote the required time to the business of the Company.

        Each director who is elected at the Annual Meeting will hold office until our annual meeting in 2018, until a successor is elected and qualified, or until the director resigns, is removed, or becomes disqualified. The Board of Directors has no reason to believe that any of the nominees for director will be unwilling or unable to serve, if elected. If due to unforeseen circumstances a nominee should become unavailable for election, the Board may either reduce the number of directors or may substitute another person for that nominee, in which event your shares will be voted for that other person.

        The Governance, Risk and Nominating Committee has determined that each nominee meets the criteria and qualifications set forth in the Company's Code of Ethics for Directors and Employees, Corporate Governance Guidelines and the Governance, Risk and Nominating Committee Charter. In addition, each nominee possesses the personal qualities and attributes we believe are essential to allow the Board of Directors to fulfill its duties to the shareholders, including personal accountability, integrity, ethical leadership, risk management, business acumen, and the ability to exercise sound and independent business judgment.

Director Nominees

        You will be asked to elect seven directors at the Annual Meeting. The nominees to the Board of Directors in 2017 are Robert Anciaux, Gilbert A. Fuller, Kevin Guest, Feng Peng, Myron W. Wentz, Ph.D., D. Richard Williams, and Frederic Winssinger. Messrs. Fuller, Peng, Williams and Winssinger are independent directors under NYSE Standards.

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        The following information was furnished to us by the nominees:

Doug BraunRobert Anciaux, 54, Chief Marketing Officer. Mr. Braun joined USANA as Vice President of Marketing in December 2011. He served in this capacity until March 2012, when he was appointed as Vice President of Marketing and Recognition and served in that role until July 2012, when he was appointed Chief Marketing Officer. Mr. Braun brings 20 years of direct selling experience to USANA. Prior to joining USANA, Mr. Braun was self-employed in 2011 and 71, has served as temporary chief executive officera director of GrowLife, Inc.USANA since July 1996. Since 1990, he has been the Managing Director of S.E.I. s.a., a consulting and investment management firm in Brussels, Belgium. Additionally, since 1982, Mr. Anciaux has been self-employed as a venture capitalist in Europe, investing in various commercial, industrial, and real estate venture companies. In some of these privately held companies, Mr. Anciaux also serves as a director. Mr. Anciaux received an Ingenieur Commercial degree from May 2011Ecole de Commerce Solvay Universite Libre de Bruxelles. We believe that Mr. Anciaux's financial expertise and experience in providing consulting and strategic advisory services to complex organizations, and his extensive experience and familiarity with the business of the Company qualify him to serve on our Board.

Gilbert A. Fuller, 76, has served as a director of USANA since September 2011. Prior to that he was president of Nikken International, Inc. from December 2008 to January 2011, vice president of sales & marketing of Nikken International, Inc. from July 2007 to November 2008 and vice president of marketing of Nikken International, Inc. from July 2005 to June 2007.2008. Prior to that, he served as vice presidentour Executive Vice President, Chief Financial Officer, and Secretary since January 2006. Mr. Fuller joined USANA in May 1996 as the Vice President of marketingFinance and served in this role until June 1999, when he was appointed as the Company's Senior Vice President. Before joining USANA, Mr. Fuller served in various executive positions for several companies. Mr. Fuller served as Chief Administrative Officer and Treasurer of Fionda, LLC,Melaleuca, Inc., a manufacturer and senior vice presidentdirect seller of global marketing at Herbalife International, Inc. wherepersonal care products. He was also the Vice President and Treasurer of Norton Company, a multinational manufacturer of ceramics and abrasives. He obtained his certified public accountant license in 1970 and kept it current until his career path developed into corporate finance. Mr. Braun spent ten years. He hasFuller received a B.B.A.B.S. in Accounting and an M.B.A. from the University of CincinnatiUtah. In December 2012, Mr. Fuller was appointed as a director of Security National Financial Corporation, a NASDAQ-listed company. We believe that Mr. Fuller's more than 12 years of experience as an executive officer of USANA, his deep understanding of our business, people and products, his 15 years of experience as a financial officer in the direct selling industry, as well as his accounting, finance and corporate strategy expertise qualify Mr. Fuller to serve on our Board of Directors.

Kevin Guest. Mr. Guest is our Chief Executive Officer. Biographical information for Mr. Guest is set out above on page 11 under "Executive Officers". Mr. Guest's important role as the leading force of our management and sales efforts and his talent as a motivating leader qualify him to serve as a member of the Board.

Feng Peng, 43, was elected to the Board in May 2016. From March 2013 to December 2016, Mr. Peng served as Chief Financial Officer of Ossen Innovation Co., Ltd., a China-based manufacturing company listed on the NASDAQ exchange. Prior to that, Mr. Peng served as Senior Vice President at MZ Group from August 2007 until September 2012 where he was responsible for providing strategic consulting services related to U.S. capital markets to Chinese clients. At MZ Group, Mr. Peng conducted extensive financial and industry due diligence, performed analysis on companies' financials, and provided management teams of client companies with extensive coaching, including detailed intelligence on investor expectations, perceptions and concerns, industry analysis, compliance, and reporting and disclosure requirements. Prior to working at MZ Group, he served in various capacities at Thomson Financial and Citigroup. Mr. Peng has been trained in both finance and accounting. He received a Master of Science in Computer Science from the New Jersey Institute of Technology. He also received a bachelor's degree in Automation Control from Shanghai Jiao Tong University in Shanghai, China in 1995. Mr. Peng is a certified Senior International Finance Manager (SIFM) in China. Mr. Peng's qualifications to sit on our Board include his extensive business experience in China, as well as his financial and corporate strategy experience.

Myron W. Wentz, Ph.D., 76, founded USANA in 1992 and served as the Chief Executive Officer and Chairman of the Board from 1992 to July 2008, when he retired as Chief Executive Officer. Dr. Wentz continues to serve as Chairman of the Board. In 1974, Dr. Wentz founded Gull Laboratories, Inc., which was a developer and manufacturer of medical diagnostic test kits and was the

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former parent corporation of USANA. Dr. Wentz was Chairman of Gull from 1974 until 1998. In 1998, Dr. Wentz founded Sanoviv, S.A. de C.V. ("Sanoviv"), a holistic integrative medical center and hospital located near Rosarito, Mexico. Joining a pathology group in Peoria, Illinois, from 1969 to 1973, Dr. Wentz served as infectious disease specialist and directed the microbiology and immunology laboratories for three hospitals in the Peoria area. He received a B.S. in Biology from North Central College, Naperville, Illinois, an M.S. in Microbiology from the University of North Dakota, and a Ph.D. in Microbiology and Immunology from the University of Utah. Dr. Wentz is our largest shareholder and as our founder and the visionary force behind the science and mission of USANA, his vast education and professional experience as a microbiologist, immunologist, and pioneer in the development of human cell culture technology, as well as his service as our Chairman and former Chief Executive Officer, uniquely qualify him to serve as a member of our Board and as our Chairman.

D. Richard Williams, 60, was appointed a director in March 2016. Mr. Williams has served as non-executive Chairman of Primerica, Inc. since April 2015 and as Chairman from October 2009 through March 2015. Prior to that, he served as Co-Chief Executive Officer from 1999 through March 2015. Mr. Williams worked for Primerica beginning in 1989 and served in various capacities, including as the Chief Financial Officer and Chief Operating Officer of the Primerica operating unit of Citigroup. Mr. Williams serves on the Board of Directors of Crawford & Company. Additionally, he serves on the Board of Trustees of the Woodruff Arts Center, the Anti-Defamation League Southeast Region, the Atlanta Area Council of the Boy Scouts of America, and the Carter Center Board of Councilors. Mr. Williams received his B.S. degree and M.B.A. from the Wharton School of the University of Pennsylvania. Mr. William's qualifications to sit on our Board include his extensive expertise in senior management, finance, M&A, strategic planning, and risk and asset management.

Frederic J. Winssinger, 48, became a director in May 2016. Mr. Winssinger has been a Managing Partner of RW Partners LLC (RWP) since 2006. RWP is a commercial real estate private equity investment company based in Phoenix, Arizona. Mr. Winssinger also oversees his family's general investment operations and in 2014, he co-founded PlanninCore Wealth Advisors to provide investment advice to individuals and families. Prior to 2006, Mr. Winssinger worked in strategy consulting for the Boston Consulting Group and as a Portfolio Manager/Financial Analyst for JP Morgan Asset Management and other privately held asset management companies. Mr. Winssinger received a B.A. in Mathematics and Economics from Claremont McKenna College and an M.B.A.M.B.A from Xavier University.The Wharton School of the University of Pennsylvania. Mr. Winssinger's qualifications to sit on our Board include his 20 years of experience in financial analysis, and his training in evaluating corporate strategy towards the creation of shareholder value under sound corporate governance.

RECOMMENDATION

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" EACH DIRECTOR NOMINEE.

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COMPENSATION OF DIRECTORS

        The table below summarizes the compensation paid by us to our directors for the fiscal year ended December 31, 2016. Note that shares and per-share amounts reflect a 2-for-1 split of the Company's common shares, which became effective November 22, 2016.

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        When determining director compensation in 2016, the Compensation Committee considered recommendations of the Company's CFO and a number of other factors, including director compensation data available regarding members of the Company's industry peer group, as well as the 2015-2016 Director Compensation Report published by the National Association of Corporate Directors and other resources.

PROPOSAL #2—RATIFICATION OF SELECTION OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM

        The Audit Committee of the Board of Directors has selected KPMG LLP ("KPMG") as the independent registered public accounting firm to audit the financial statements of the Company and its subsidiaries for the fiscal year ending December 30, 2017 and internal control over financial reporting at December 30, 2017. KPMG has served as our independent registered public accounting firm since September 16, 2013 and audited our financial statements for the fiscal year ended December 31, 2016 and internal control over financial reporting at December 31, 2016.

        Shareholder ratification of the appointment of the independent registered public accounting firm is not required. We are asking shareholders to ratify the appointment because we believe it is a sound corporate governance practice. If our shareholders do not ratify the selection, the Audit Committee will consider whether or not to retain KPMG but may still retain them.

        The ratification of the appointment of the independent registered public accounting firm requires the affirmative vote of a majority of the votes cast at the Annual Meeting. Representatives of KPMG will be present at the annual meeting, will have an opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions from shareholders.

RECOMMENDATION

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" RATIFICATION OF THE APPOINTMENT OF KPMG LLP, AS THE COMPANY'S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR FISCAL YEAR 2017.

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REPORT OF THE AUDIT COMMITTEE

        The Audit Committee oversees and monitors the Company's financial reporting process on behalf of the Board of Directors. Management has the primary responsibility for the financial statements and the reporting process, including the Company's system of internal control over financial reporting. In fulfilling its oversight responsibilities, the Committee reviewed and discussed with management the audited financial statements to be included in the Company's Annual Report on Form 10-K for the year ended December 31, 2016, including a discussion of the quality and the acceptability of the Company's financial reporting practices and the internal control over financial reporting.

        The Committee reviewed with KPMG LLP, the independent registered public accounting firm which is responsible for expressing opinions on the conformity of those audited financial statements with accounting principles generally accepted in the United States of America and on the Company's internal control over financial reporting, its judgments as to the quality and the acceptability of the Company's financial reporting and such other matters as are required to be discussed with the Committee under the standards of the Public Company Accounting Oversight Board (United States). In addition, the Committee discussed with KPMG LLP its independence from management and the Company, including the impact of any non-audit-related services provided to the Company, the matters in that firm's written disclosures and the letter from KPMG LLP to the Committee pursuant to the applicable requirements of the Public Company Accounting Oversight Board (PCAOB) regarding the independent registered public accounting firm's communications with the Audit Committee concerning independence. The Committee also discussed with the independent registered public accounting firm the matters required to be discussed by the statement on Auditing Standards No. 1301, as adopted by the PCAOB (which replaced PCAOB Auditing Standard No. 61).

        Further, the Committee discussed with the Company's internal audit executive and KPMG LLP the overall scope and plans for their respective audits. The Committee meets periodically with the internal audit executive and representatives of the independent registered public accounting firm, with and without management present, to discuss the results of the examinations, their evaluations of the Company's internal controls (including internal control over financial reporting), and the overall quality of the Company's financial reporting.

        In reliance on the reviews and discussions referred to above, the Committee recommended to the Board of Directors that the audited financial statements be included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2016 filed with the Securities and Exchange Commission. The Committee also evaluated and reappointed KPMG LLP as the Company's independent registered public accounting firm for fiscal 2017.

        Respectfully submitted by the members of the Audit Committee:

Policy on Pre-Approval of Audit and Permissible Non-Audit Services

        The Audit Committee pre-approves any engagement of KPMG and has the ultimate authority and responsibility to select, evaluate and where appropriate, replace the independent registered public accounting firm and nominate an independent registered public accounting firm for shareholder approval. While ratification of the selection of accountants by the shareholders is not required and is not binding upon the Audit Committee or the Company, in the event of a negative vote on such ratification, the Audit Committee might choose to reconsider its selection.

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        Prior to the performance of any services, the Audit Committee approves all audit and non-audit services to be provided by the Company's independent registered public accounting firm and the fees to be paid therefor. Although the Sarbanes-Oxley Act permits the Audit Committee to pre-approve some types or categories of services to be provided by the independent registered public accounting firm, it is the current practice of the Audit Committee to specifically approve all services provided by the independent registered public accounting firm in advance, rather than to pre-approve any type of service. In connection with this practice, the Audit Committee has considered whether the provision of non-audit services is compatible with maintaining KPMG's independence.

Independence

        KPMG has advised us that it has no direct or indirect financial interest in the Company or in any of its subsidiaries and that during 2016 it had no connection with the Company or any of its subsidiaries, other than as its independent registered public accounting firm or in connection with certain other services, as described below.

Services

        During fiscal year 2016, KPMG performed services consisting of the audit of the annual consolidated financial statements of the Company, and the effectiveness of our internal control over financial reporting, review of the quarterly financial statements for the quarters ended April 2, 2016, July 2, 2016 and October 1, 2016, stand-alone audits of subsidiaries, and accounting consultations, consents, other services related to SEC filings by the Company and its subsidiaries, tax compliance services and transfer pricing services. KPMG did not perform any financial information systems design and implementation services for the Company for fiscal year 2016.

        During fiscal year 2015, KPMG performed services consisting of the audit of the annual consolidated financial statements of the Company, and the effectiveness of our internal control over financial reporting, review of the quarterly financial statements for the quarters ended April 4, 2015, July 4, 2015 and October 3, 2015, stand-alone audits of subsidiaries, and accounting consultations, consents, other services related to SEC filings by the Company and its subsidiaries, tax compliance services and transfer pricing services. KPMG did not perform any financial information systems design and implementation services for the Company for fiscal year 2015.

        The following table summarizes the fees paid by us to KPMG during fiscal years 2015 and 2016.

EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION AND ANALYSIS Compensation Discussion and Analysis

Introduction

        The following Compensation Discussion and Analysis describes the material elements of the compensation and benefit programs for our Co-ChiefChief Executive Officers,Officer, Chief Financial Officer, and the three other most highly-compensated executive officers as of the end of fiscal year 2015.2016. In this Proxy Statement, we refer to these officers as our "Named Executive Officers." Our Named Executive

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Officers are also included in the group referred to herein individually as anby the terms "Executive" and collectively as "Executives". in the Compensation Discussion and Analysis.

Executive Summary and Overview

        Summary of 20152016 Accomplishments.    Fiscal 2015 was an exceptionalIn fiscal year 2016, we surpassed the $1 billion mark in net sales for USANA. From a financial perspective, we deliveredthe first time in our 13^thhistory, generating our 14th consecutive year of record net sales, as well as oursales. We also reported the highest annual net earnings and earnings-per-shareper share in the history of the Company. These results were driven by a number of accomplishments duringCompany and finished the year, including our achievement of more than 20% growth in the number of Active Associates who use and sell our products around the world. We ended the 2015 fiscal year with a record 421,000 Activenumber of active Associates and 89,000 Preferred Customers worldwide. Associate and customerCustomers. Customer growth isremains our highest priority as we continuestrive to focus on improvingimprove the overall health and nutrition of individuals and families around the world. In November 2016, we effected a two-for-one forward split of our common stock.

        Our results for the year were driven by execution of our 2015 growth2016 strategies, which included offering market-specific incentives to motivate our sales force,(i) advancing our personalization initiative,strategy through new product launches and increasingofferings; (ii) continuing to invest in China, largely by completing and shifting production to our brand recognitionnew manufacturing facility; and (iii) investing in information technology systems and infrastructure to make it easier forsupport our sales forcegrowing customer base that further enhances the experience of doing business with USANA around the world.

        Our introduction and launch of InCelligence™ was perhaps our most significant accomplishment in 2016. InCelligence™ is our proprietary, patent-pending, technology that is designed to talk about USANA.support the body's natural ability to nourish, protect and renew its cells. The science behind InCelligence™ reflects a significant shift in nutritional supplementation and Dr. Wentz, with our team of exceptional scientists, has positioned USANA as a leader in this technology. We also introduced our new core product, CellSentials™ (which fully incorporates the InCelligence™ technology), at our 2016 international convention in August. This product, and others, were received by our customers with tremendous excitement. The InCelligence™ platform represents the future of our various product lines and is intended to keep USANA at the forefront of nutritional supplementation.

        During the year we offered a variety of market specific incentives to our sales force. The most impactful was offered world-wide during late 2014, and during the first part of 2015 in China. This incentive, and its residual effect, was successful in accelerating our customer growth during much of 2015. During the second half of 2015, we offered additional incentives in many of our markets to continue driving customer growth. The short-term incentives we offered in many of our markets during 2015 contributed to our 20.6% Associate growth and 9.9% Preferred Customer growth year-over-year.

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        We also continued to advancemake investments to improve our personalization strategy duringinfrastructure in China. Our most significant accomplishment was the year. Over the last few years, we have added personalized aspectssuccessful completion of, and transition to, our global brand, Associate compensation plan, and our Associates' e-business environment to make it easier and more enjoyable to do business with USANA. In 2015, we continued to personalize our product line by introducing our new "MySmart^TMFoods" products. MySmart^TMFoods are science-based, healthy nutrition shakes, bars, boosters and flavor optimizers that provide our customers with customized healthy food options. We made MySmart^TMFoods available to our Associates for a limited time in 2015 as a pre-launch opportunity to purchase and try the products. During the first half of 2016, we will officially launch these products.

        We also increased our brand recognition in 2015 by expanding our relationship with Dr. Mehmet Oz, as a Trusted Partner and Sponsor ofThe Dr. Oz Show, and by continuing to advance our athlete sponsorship program around the world. Under our partnership with Dr. Oz, USANA products were regularly featured onThe Dr. Oz Show in 2015. This partnership has increased our brand recognition in North America and our other regions around the world.

        In 2015, we also continued to see our business grow in China. Specifically, annual net sales in China increased over 71% on a year-over-year basis and the number of Active Associates increased over 46%. We also made significant progress during the year on the construction of our new state-of-the-art production facility in Beijing, whichthe fourth quarter. This accomplishment was the result of a significant undertaking by our U.S. and China operations/regulatory teams, and extensive cooperation with the Chinese government. Adding 350,000 square feet of production capacity to our manufacturing operations, this facility is scheduled to becomenow fully operational duringand will provide the first half of 2016.

        Finally,production capacity we need in late 2015 we officially opened Indonesia, which marks our 20^th market worldwide. Indonesia is a promising addition to our South East Asia Pacific Region, and we are optimistic aboutChina for the potential growth opportunity there.foreseeable future.

        Overview of Compensation Program.    We believe that our Executives and employees, as well as the compensation programs that incent them, are key factors in driving our strong financial and operational performance. Our executive compensation program is designed to provide a competitive and internally equitable compensation and benefits package. We also strive to ensure that our executive compensation program reflects a pay-for-performance philosophy and promotes Executive motivation and retention.

        Our executive compensation program includes base salary, short-term incentive compensation (in the form of a cash bonus), and long-term incentive compensation (in the form of equity awards). Short-term incentive compensation is performance-based and designed to motivate our Executives to achieve annual financial and non-financial performance objectives. To minimize potential risk, the potential for short-term incentive compensation is typicallyhas historically been capped at 100% of an Executive's base salary. Long-term incentive compensation utilizes equity awards, which vest over several years. These awards reward the Executive for sustainable Company performance and align the financial interests of our Executives with those of our shareholders.

        Other than as described above, we typically do not provide benefits to our Executives that are different from, or in addition to, those that are provided to our general employees. Additionally, we typically do not enter into pre-arranged severance agreements or contracts with our Executives that

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contain post-termination or change-in-control payment provisions, or provide significant perquisites or personal benefits to our Executives.

Compensation Philosophy and Objectives

        The Company'sOur compensation philosophy, as approved by the Compensation Committee, is to establish and maintain executive compensation programs that are designed to accomplish the following objectives:

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To attract and retain, through a fair and competitive compensation plan, Executives who have the intelligence, education, and experience that is required to effectively administer the affairs of the Company;

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To motivate our Executives to achieve certain financial and non-financial performance objectives for the benefit of our shareholders by tying components of their total compensation to individual and Company performance; and



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To ensure that compensation practices do not impair USANA'sour financial strength or future success.

        The Compensation Committee intendsacts to meet these objectives by utilizing and maintaining a balance among three major components of compensation: base salary, short-term incentive compensation (cash bonus), and long-term incentive compensation (in the form of equity awards). The Committee believes that these three components provide thean appropriate framework to attract, retain and motivate our Executives, and align a significant portion of executive compensation with short-and long-term performance objectives that drive shareholder value. As shown in the compensation tables following this report,Proxy Statement, our Executives do not currently receive retirement benefits, pre-determined severance arrangements, deferred compensation opportunities, or other perquisites that are commonly provided to executives of similarly sized companies.

Role of Compensation Committee

        Our executive compensation philosophy and practice has been developed through a collaborative effort of the Compensation Committee, the CEO, and the CFO. With the appointmentDuring most of Mr. Wentz and Mr. Guest as Co-CEO'sfiscal year 2016, we were led by Co-CEO's. Since November 2016, we have a single CEO. The Committee seeks input in August 2015,meetings of the Compensation Committee began, and will continue to, seek input from each Co-CEO on the Company's executive compensation philosophy. While our Co-CEOs and CFO offerCEO (or, historically, the Co-CEO's), including their ideas, opinions, and proposals in Compensation Committee meetings,regarding executive compensation; however, the Compensation Committee functions and votes independently from these officers. The Compensation Committeeand is responsible for all changes to the executive compensation philosophy and program. The Compensation Committee as of the date of this Proxy Statement, consists of three members of USANA'sour Board of Directors, all of whom are "independent" under the rules of the NYSE. These members are appointed to the Compensation Committee by the Board of Directors. The Compensation Committee acts under a written charter, which outlines the committee's authority and responsibilities.

Role of Corporate Leadership in Assisting Compensation Committee

        The Compensation Committee has the primary authority to determine the Company's compensation philosophy and to establish compensation for the Company'sour Named Executive Officers. It is responsible for ensuring that executive compensation decisions are thoroughly researched and implemented. All of the Company'sour Executives and employees participate in an annual performance review with their immediate supervisor, during which the Executive or employee receives input about his or her performance and contributions to the Company's results for the period being assessed. The Compensation Committee seeks input from the Company's Co-CEOsCEO and CFO to identify key factors and to obtain information that is related to executive compensation. These key factors and information generally involve the individual Executive's level of responsibility, his or her years of experience, his or her current overall compensation level in relation to external market studies and internal equity analysis

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between executives, the impact of current compensation practices on the Company'sour financial statements and condition, and the relationship between executive compensation and performance of the Company.

        The Company'sOur CFO takes direction from and makes suggestions to the Chairman of the Compensation Committee in establishing the quarterly committee meeting agenda and in preparing the materials to be presented to the Compensation Committee. These materials contain minutes from prior meetings, key items to be addressed, and background information to help the Compensation Committee in its decision-making process.

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Compensation Consultant

        In late 2014, the Compensation Committee retained Frederic W. Cook & Co. (the "Compensation Consultant"), or FWC, as itswho the Compensation Committee determined to be independent, to assess the competitiveness of compensation consultantlevels for 2015certain of our officers, including our Named Executive Officers, relative to assist the committee in reviewing our executive compensation program, to provide compensation data and alternatives to the committee, and to provide advice to the committee as requested. FWCsurvey market data. The Compensation Consultant provided services to the Compensation Committee only in late 2014 and early 2015 and did not perform any work for the Company outside of the services it performed for the Compensation Committee. TheIn 2015, the Compensation Committee consideredmade certain decisions regarding Named Executive Officer (i) salaries, (ii) the compensation data and alternatives provided by FWC in analyzing and rendering compensation decisions in 2015, including setting annualmix between base salary, compensation, short-term incentive compensation, and long-term incentive compensation, and (iii) the amount of target long-term equity incentive awards for our Executives.the Named Executive Officers after considering the input of the Compensation Consultant, survey market data, Company performance, and other relevant factors.

        As a basis for the market data provided to the Compensation Committee, FWCthe Compensation Consultant utilized compensation data from a group of 22 peer companies set out below. These companies arewere all within a reasonable range of the Company's revenue, operating income, and market capitalization. As of January 1, 2015, we were at or near the median of the peer group with respect to revenue, operating income and market capitalization. This information was gathered and analyzed for the 25th, 50th and 75th percentiles for annual salary, short-term incentive pay elements and long-term incentive pay elements. Where possible, our Executives were matched to appropriate proxy and survey positions based on job duties and level of responsibility. The peer group information and other data provided by FWC are among several factors that the Compensation Committee utilized in making compensation decisions in 2015. The following companies were included in the 2015 peer group.

        In late 2016 and early 2017, the Compensation Committee again engaged the Compensation Consultant to advise the Compensation Committee on Executive compensation, including total compensation benchmarking and aggregate equity compensation and incentive practices. Representatives of the Compensation Consultant delivered a report to the Compensation Committee at its February 2017 meeting and discussed the same with the committee. Going forward, the Compensation Committee has requested that our CFO work with the Compensation Consultant to prepare a plan to implement an updated long-term incentive program for Executives. While the

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Compensation Committee has been undertaking this study during 2016, no additional equity grants were made to Executives other than to new hires.

2016 Compensation Determinations

        In 2016, the Compensation Committee referenced updated data from the above sources in considering the appropriate levels of base salary, bonus and long-term incentive compensation for our Executives, as discussed below. In addition to the FWCCompensation Consultant's market data, the Compensation Committee utilized the following materials, along with other resources and tools, to render compensation decisions for 2015:2016: (i) surveys and reports of executive compensation paid by public companies, with characteristics similar to USANA, on a national basis; and (ii) surveys from Mercer, ERI, and the U.S. Direct Selling Association and Western Management Group of executive compensation paid by certain of the Company's direct competitors, consisting of both public and private companies, on a local and national basis. These materials and resources help provide solid benchmarks for each component of our executive compensation as well as a general understanding of the total compensation offered by companies in our industry who are competing for top talent.

Components of Compensation

Base Salary

        Base salary represents the fixed component of executive compensation. It is designed to compensate our Executives fairly and competitively at levels necessary to attract, retain and motivate qualified executives in our industry. Consistent with this philosophy, the Compensation Committee, on an annual basis, evaluates our Executives' base salaries. The Committee asks for input and

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recommendations from the Co-CEOsCEO and CFO and then considers (i) the Executive's scope of responsibilities, maturity in role, demonstrated level of performance, accomplishments and contributions to the Company; (ii) the performance of USANA, both financially and operationally; (iii) current market data and salary levels for each Executive's particular position; and (iv) the total compensation paid to each Executive. The Committee then renders a decision for each Executive's base salary based on the total mix of the foregoing information.

        As part of its 20152016 Executive compensation evaluation, the Compensation Committee, after reviewing the information outlined above, approved the Named Executive Officers' base salaries from July 20152016 through June 20162017 as follows:

        The actual base salariescash compensation paid to our Named Executive Officers during the year ended January 2,December 31, 2016 areis reflected in column (c) of the Summary Compensation Table on page 25 of this Proxy Statement.

2016 Non-Equity Incentive Plan Compensation

        We offer our Named Executive Officers non-equity incentive plan compensation in the form of a cash bonus that is based on USANA's achievement of certain financial performance objectives during the applicable year. Cash bonuses are based on a percentage of the Executive's base salary. Each year, the Compensation Committee sets the range of the cash bonus for which each Executive is eligible and sets the performance objectives on which cash bonuses for that year will be based.

2015 Non-Equity Incentive Plan

        For 2015,2016, the Compensation Committee approved the 20152016 Executive Bonus Plan (the "2015"2016 Bonus Plan"), which was based on growth in net sales and profitability. The Compensation Committee approved this single financial performance objective to: (i) focus the Company's Executives on growing net sales in 20152016 without sacrificing profitability; (ii) continue to align the bonus opportunity under the 20152016 Bonus Plan for all Executives to promote internal equity; (iii) foster teamwork among markets and Executives; and (iv) align the 20152016 Bonus Plan offered to Executives with the profit sharing plan offered to all other employees of the Company.

        Under the 20152016 Bonus Plan, 9% of the Company's adjusted operating profits which exceedin excess of 10% of net sales, were to be paidused to Executives in the formcreate a bonus pool for payment of a cash bonus.bonuses to Executives. For purposes of the 2015

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2016 Bonus Plan, the term "adjusted operating profit" is calculated as (i) the Company's earnings from operations, plus (ii) positive adjustments to earnings from operations for Executive and employee bonus accruals and equity compensation expense. Payments under the 20152016 Bonus Plan were distributed as an equal percent of the Executive's base salary.

        Under the 20152016 Bonus Plan, eligible Executives were eligiblehad the potential to receive a cash bonus of between zero and 100% of their base salary, depending on the performance of the Company under the criteria of the plan. Each Executive's target bonus percentage under the 20152016 Bonus Plan was 50% of the Executive's base salary.

20152016 Executive Bonus Plan Payout

        Shortly after the end of fiscal 2015,2016, the Compensation Committee reviewed the foregoing performance objectives and evaluated the actual performance delivered by the Company under the 20152016 Bonus Plan. The Compensation Committee determined that the Company delivered strong financial and operating performance in 20152016 and, in particular, noted that the Company:

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Achieved 20152016 net sales of $918.5$1,006 million, which is a 16.2%9.5% increase compared to fiscal 2015;



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Achieved 20152016 adjusted operating profit of $169.2$168.9 million; and



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Achieved 20152016 adjusted operating profit in excess of 10% of net sales of $77.3$68.3 million.

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        Based on the Company's performance, and the criteria of the 20152016 Bonus Plan, the Compensation Committee determined that each Executive had earned a cash bonus equal to 57.8%49.0% of the Executive's base salary under the 20152016 Bonus Plan. Consequently, the committeeCompensation Committee awarded this bonus amount to each Executive. The actual cash bonuses paid to our Named Executive Officers under the 20152016 Bonus Plan are reflected in column (g) of the Summary Compensation Table of this Proxy Statement.

20162017 Executive Bonus Plan

        For 2016,fiscal year 2017, the Compensation Committee approved the 20162017 Executive Bonus Plan (the "2016"2017 Bonus Plan"), which is based on the same performance objectives as the 20152016 Bonus Plan: growth in net sales and profitability. As part of its determination to again utilize this bonus criteria and structure, the committee noted: (i) the strong operating results delivered by the Executives and the Company in 2015;2016; (ii) the successful alignment of the Company's Executives under the 20152016 Bonus Plan, and (iii) the internal equity among Executives that was created by the 20152016 Bonus Plan.

        Under the 20162017 Bonus Plan, 9% of the Company's adjusted operating profits, which exceed 10% of net sales, will again be paid to Executives in the form of a cash bonus. Payments under the 20162017 Bonus Plan will be distributed as an equal percent of the Executive's base salary. Under the 20162017 Bonus Plan, Executives will be eligiblehave the potential to receive a cash bonus of between zero and 100% of their base salary, depending on the performance of the Company under the criteria of the plan. Each Executive's target bonus percentage under the 20162017 Bonus Plan is 50% of the Executive's base salary, with the exception that the target bonus percentages for Mr. Guest, our CEO, and Mr. Brown, our President and COO, are now 75% of each respective Executive's base salary. The Compensation Committee set the target bonus under the 2017 Bonus Plan for these Executives pursuant to recommendations of the Compensation Consultant and other market resources. Future estimated payouts under the 20162017 Bonus Plan are reflected in the Grants of Plan-Based Awards table of this Proxy Statement.

Equity Compensation

        Equity compensation is an integral part of USANA's compensation philosophy. We believe that equity grants that vest over a period of years tie a portion of our Executives' compensation to the Company's long-term performance and, thereby, align the interests of our Executives with the interests of our shareholders. Our equity compensation program delivers additional compensation to Executives only when the Company performs and the value of the Company's stock increases. USANA providesHistorically, we have provided equity-based compensation primarily through the issuance of Stock-Settled Stock Appreciation Rightsstock-settled stock appreciation rights ("SSARs").

Table of Contents In recent years, the Compensation Committee has also granted deferred stock units ("DSUs") to outside directors. The Compensation Committee awards equity compensation to supplement our Executives' compensation to ensure that total compensation is competitive in the marketplace and to align compensation with our long term goals and objectives.

Grants of equity awards are made for both Executives and other eligible employees at regular Compensation Committee meetings and at special meetings, as needed. To further align the interests of our Executives and shareholders, we have implemented stock ownership guidelines for our Executives. Pursuant to these guidelines, our Executives voluntarily agree to hold ten percent (10%) of the shares of USANA common stock issued to them as a result of a SSAR exercise for a period of five years or until they are no longer employed by the Company.

        The Compensation Committee's philosophy has been to issue intermittent SSAR awards to Executives to drive long-term Company performance as well as individual Executive performance. In general, SSAR awards are granted to Executives as they enter into a qualifying position and vest annually in equal installments over a five-year period. Additional grants arehave been awarded to

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Executives as seen necessary by the Compensation Committee to maintain sufficient long term incentive to accomplish the objectives outlined above. These additional grants typically do not vest in the first two years, but only at the end of years three, four and five, and such vesting for a particular Executive commences when the vesting schedule of that Executive's particular SSAR award ends. The grant price for equity awards is the fair market value of the award as of the date of grant as determined by the closing price of the Company's common stock on the date of grant.

        In 2015,2016, the Compensation Committee issued SSAR awardsmade no equity award grants to the Named Executive Officers as detailedit continues to review potential changes to the long-term incentive component of Executive compensation. As indicated above, in December 2016, the Outstanding Equity AwardsCompensation Committee engaged the Compensation Consultant to provide the Committee with updated data and recommendations related to benchmarking, aggregate equity usage and incentive practices for the Company. The Compensation Committee will consider further recommendations of the Compensation Consultant and the CFO at Fiscal Year-End Table of this Proxy Statement. The 2015 awards sequentially follow the Company's last broad SSAR award issuance in 2014. After the 2014 awards complete vesting, the 2015 awards will begin to vest.a future meeting regarding a plan for new equity grants for executives.

Other Compensation

        Other than as described above, USANA does not at this time provide benefits to its Named Executive Officers that are different from or in addition to those that are provided to its general employees. Those benefits are described below.

        Retirement:    Executives may participate in Company sponsored 401(k) retirement plans on the same terms and conditions, including Company matching provisions, as other employees. For the year ended January 2,December 31, 2016, we contributed matching funds totaling $1,457,912$1,593,674 to our 401(k) plan in which all eligible employee participants shared. During 2015,2016, each of our eligible Executives participated in our 401(k) plan and shared matching funds totaling $72,800. Mrs. Woo is not eligible to participate in our 401(k) plan and the Company pays retirement compensation to her, as disclosed in the Summary Compensation Table, pursuant to Hong Kong law.$58,996. Except as disclosed in this paragraph, we provide no other retirement benefits to our Executives.

        Severance:    USANA has no pre-arranged severance agreements or contracts with any of our Executives that contain post-termination or change-in-control payment provisions. We have, however, provided severance benefits to Executives on a case-by-case basis.

        Perquisites:    It is our general practice not to provide significant perquisites or personal benefits to our Executives. The Compensation Committee, however, retains the discretion to consider and award reasonable perquisites or personal benefits to Executives as necessary to accomplish the objectives under our compensation philosophy. In this regard, it should be noted that we do not currently provide pension arrangements, post-retirement health coverage, or similar benefits for our Executives or employees. In 2015,2016, we paid health, life, and disability insurance premiums on behalf of our Executives, all on the same terms as those that we provide to all of the Company's employees.

        Insurance Plans and Other Benefits:    We provide insurance plans and other benefits to our Executives that are similar to those plans and benefits that are customarily provided to general employees of the Company.

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        Indemnification:    Article VI of our Amended and Restated Articles of Incorporation and Article 5 of our Bylaws provide for indemnification of our directors, officers, employees, and other agents to the extent and under the circumstances permitted by the Utah Revised Business Corporation Act. We have entered into agreements with our directors and officers that will require us, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers to the fullest extent allowed. Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended (the "Securities Act"), may be permitted to directors, officers, or persons controlling us under the foregoing provisions, the SEC has stated that such indemnification is against public policy, as expressed in the Securities Act, and, therefore, such indemnification provisions may be unenforceable.

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Section 162(m) Treatment Regarding Performance-Based Equity Awards

        Under Section 162(m) of the Internal Revenue Code of 1986, as amended ("Section 162(m)"), a public company is generally denied deductions for compensation paid to the chief executive officer and the next four most highly compensated executive officers to the extent the compensation for any such individual exceeds $1,000,000$1.0 million for the taxable year. The Company's executiveThere is an exception to the limit on deductibility for performance-based compensation programs are designed to preserve the deductibility ofthat meets certain requirements. We intend that compensation payable to executive officers, althoughpaid under our incentive plans be generally fully deductible for federal income tax purposes. However, deductibility is just one among a number of factors considered in determining appropriate levels or types of compensation.

Consideration of Shareholder Advisory Votes

        The Dodd-Frank Wall Street Reformcompensation and Consumer Protection Act (the "Dodd-Frank Act"), required that we include in our proxy statement for the 2014 Annual Meeting of Shareholders (the "2014 Annual Meeting") a non-binding, advisory shareholder vote to approve the compensation of our Named Executive Officers. At the 2014 Annual Meeting, our shareholders voted for approval of the compensation of our Named Executive Officers (99% of votes cast). Historically, the Compensation Committee has recommended, and shareholders have approved (67%may approve compensation that exceeds the limitation in order to ensure competitive levels of votes cast) the Company's determination to include a shareholder advisory vote ontotal compensation for our executive compensation in its future proxy materials once every three years. The Compensation Committee has affirmed its recommendation to the Board that this advisory vote be held once every three years and the Board has approved the committee's recommendation. This will be the frequency of such advisory votes until the next required vote on the frequency of advisory votes on executive compensation, which will occur at the Company's Annual Meeting of shareholders in 2017, or until the Compensation Committee, or Board of Directors, otherwise determines a different frequency for such shareholder advisory votes.

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REPORT OF THE COMPENSATION COMMITTEE

        The Compensation Committee of the Board of Directors has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management. Based on this review and discussion, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement.

        Respectfully submitted by the members of the Compensation Committee:

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SUMMARY COMPENSATION TABLE

        The following table summarizessets forth all compensation paid to oureach of the Named Executive Officers in each offor the three most recently completed fiscal years.years 2016, 2015 and 2014, who were serving as executive officers at December 31, 2016.

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GRANTS OF PLAN-BASED AWARDS

        The following table contains information regardingNo grants of equity awards grantedwere made to theour Named Executive Officers during the fiscal year ended January 2, 2016 and theDecember 31, 2016. The table below summarizes estimated or targeted payouts to the Named Executive Officers under the 20162017 Bonus Plan described in the Compensation Discussion and Analysis section of this Proxy Statement.

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OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

        The following table includes certain information with respect to the value of all equity awards previously granted to the Named Executive Officers outstanding as of December 31, 2016.

Outstanding Equity Awards at the end of the fiscal year ended January 2, 2016.Fiscal Year-End