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Report. 2 SMITH & WESSON ANNUAL REPORT 2020 TURNING TO FISCAL 2021 BOARD OF DIRECTORS Robert L. Scott Chairman Michael F. GoldenVice Chairman :LWKWKHVSLQR΍RIRXURXWGRRU Anita D. BrittDirector SURGXFWVDQGDFFHVVRULHVEXVLQHVV John B. FurmanDirector Barry M. MonheitDirector QRZFRPSOHWHZHDUHDSXUHSOD\ Mitchell A. SaltzDirector ȴUHDUPFRPSDQ\DQGZHDUHH[FLWHG Mark P. SmithDirector DERXWWKHRSSRUWXQLWLHVWKDWSUHVHQWV EXECUTIVE OFFICERS Mark P. Smith 3UHVLGHQW&KLHI([HFXWLYH2ɝFHUDQG'LUHFWRU 2XUJURZLQJSRUWIROLRRISRSXODUFRQVXPHUȴUHDUP Deana L. McPherson, CPA, CGMA SURGXFWVFRPELQHGZLWKRXUVWURQJEDODQFH &KLHI)LQDQFLDO2ɝFHU VKHHWSRVLWLRQXVZHOOIRUȴVFDO2XUSURGXFW Robert J. Cicero GHYHORSPHQWDQGHQJLQHHULQJWHDPVZLOOUHPDLQ Senior Vice President, General Counsel, IRFXVHGRQLQQRYDWLRQWDSSLQJLQWRWKHLUSDVVLRQ &KLHI&RPSOLDQFH2ɝFHUDQG6HFUHWDU\ IRUSHUVRQDOSURWHFWLRQDQGWKHVKRRWLQJVSRUWVWR GHVLJQDQGGHOLYHUQHZSURGXFWVWKDWWUXO\H[FLWHRXU FRQVXPHUV:HEHOLHYHWKLVDELOLW\WRXQGHUVWDQG INVESTOR INFORMATION WKHQHHGVRIRXUFRQVXPHUFRPELQHGZLWKRXU (PDLOLQYHVWRUUHODWLRQV#VPLWKZHVVRQFRP LPSUHVVLYHEUDQGSRUWIROLRDQGRXUDELOLW\WRUDSLGO\ LQQRYDWHZLOOEHLQVWUXPHQWDOLQDOORZLQJXVWRGHOLYHU ORQJWHUPPDUNHWVKDUHJDLQVDQGWRUHWXUQH[FHVV LEGAL COUNSEL FDSLWDOWRRXUVWRFNKROGHUV Greenberg Traurig, LLP (DVW&DPHOEDFN5RDG :HWKDQNRXUFXVWRPHUVIRUWKHLUOR\DOW\RXU 6XLWH VWRFNKROGHUVIRUWKHLUVXSSRUWDQGRXUHPSOR\HHVIRU 3KRHQL[$UL]RQD WKHLUGHGLFDWLRQDQGOR\DOW\WRRXUFRPSDQ\WRRXU FRPPXQLWLHVDQGWRHDFKRWKHU:HORRNIRUZDUGWR ȴVFDODVZHFRQWLQXHWRSRVLWLRQRXUFRPSDQ\ TRANSFER AGENT IRUORQJWHUPVXFFHVV Issuer Direct Corporation Julie Felix (DVW0XUUD\+ROODGD\5G6XLWH 6DOW/DNH&LW\8WDK ([WȂ2 0DUN36PLWK 5REHUW/6FRWW President, Chairman of the Board &KLHI([HFXWLYH2ɝFHU'LUHFWRU Compensation Committee Nominations and Corporate Governance Committee Audit Committee SMITH & WESSON ANNUAL REPORT 2020 3 SAFETY $VDOHDGLQJ$PHULFDQPDQXIDFWXUHURIȴUHDUPVVLQFH ZHDUHSURXGRIRXUULFKKLVWRU\ZKLFKLQFOXGHVDQXPEHU RIORQJVWDQGLQJLQLWLDWLYHVWRVXSSRUWWKHVDIHDQGOHJDO SRVVHVVLRQDQGXVHRIRXUSURGXFWVΖQDGGLWLRQWKURXJK PHPEHUVKLSLQDQGFRQWULEXWLRQVWRRXULQGXVWU\ȇVWUDGH DVVRFLDWLRQWKH1DWLRQDO6KRRWLQJ6SRUWV)RXQGDWLRQZH VXSSRUWPDQ\LQLWLDWLYHVWRSURPRWHWKHVDIHRZQHUVKLS RSHUDWLRQVWRUDJHDQGVDIHNHHSLQJRIȴUHDUPVLQFOXGLQJ SAFETY LOCKS PROJECT CHILDSAFE® :HZHUHDPRQJWKHȴUVWȴUHDUPFRPSDQLHVWR &RQGXFWHGE\WKH166)LQSDUWQHUVKLSZLWKPRUHWKDQ YROXQWDULO\SURYLGHDFDEOHVW\OHȴUHDUPVDIHW\ORFN ODZHQIRUFHPHQWDJHQFLHV3URMHFW&KLOG6DIHLVWKHODUJHVWPRVW LQFOXGHGLQWKHER[ZLWKHYHU\ȴUHDUPZHPDNH:H FRPSUHKHQVLYHȴUHDUPVDIHW\HGXFDWLRQSURJUDPLQWKH8QLWHG EHJDQWKLVSUDFWLFHPDQ\\HDUVDJRDQGKDYHVLQFH 6WDWHVSURPRWLQJȴUHDUPVDIHW\WKURXJKWKHGLVWULEXWLRQRI JLYHQDZD\PLOOLRQVRIIUHHȴUHDUPVDIHW\ORFNV VDIHW\HGXFDWLRQPDWHULDOVDQGIUHHȴUHDUPVDIHW\NLWV6LQFH 3URMHFW&KLOG6DIHKDVGLVWULEXWHGPRUHWKDQPLOOLRQ OWNER’S MANUALS ȴUHDUPVDIHW\NLWVLQFOXGLQJFDEOHVW\OHORFNVWRȴUHDUPRZQHUV :HFDOORXWDQGSURPLQHQWO\GLVSOD\LQRXU 7KHSURMHFWȇVȊ2ZQΖW"5HVSHFWΖW6HFXUHΖWȋFDPSDLJQJLYHV RZQHUVȇPDQXDOVLQIRUPDWLRQRQUHVSRQVLEOH 166)LQGXVWU\PHPEHUVDQRQJRLQJSODWIRUPWRSURPRWHDQG ȴUHDUPRZQHUVKLSVDIHKDQGOLQJDQGVDIH HQFRXUDJHȴUHDUPVDIHW\DQGWKHVDIHVWRUDJHRIȴUHDUPV VWRUDJHDQGZHSODFHDVWLFNHULQWKHER[RIHDFK ȴUHDUPZHPDNHWKDWUHIHUVRZQHUVWRWKHVH DON’T LIE FOR THE OTHER GUY SURYLVLRQVLQWKHDFFRPSDQ\LQJRZQHUȇVPDQXDO 'RQȇW/LHIRUWKH2WKHU*X\LVDQDWLRQDOFDPSDLJQODXQFKHGE\ WKH166)LQLQSDUWQHUVKLSZLWKWKH$7)WRKHOSSUHYHQW BASIC PISTOL HANDBOOK SURKLELWHGSHUVRQVIURPJHWWLQJWKHLUKDQGVRQȴUHDUPV WKURXJKLOOHJDOȊVWUDZSXUFKDVHVȋ'RQȇW/LHIRUWKH2WKHU*X\ :HKDYHORQJEHHQDFRQWULEXWLQJDXWKRUWRDQG DVVLVWVȴUHDUPVUHWDLOHUVWRLGHQWLI\DQGGHWHUVWUDZSXUFKDVHV DVSRQVRURIDQDWLRQDOO\NQRZQȴUHDUPVVDIHW\ DQGWRUDLVHSXEOLFDZDUHQHVVWKDWVWUDZSXUFKDVLQJLVD LQVWUXFWLRQPDQXDOWKDWLVEURDGO\GLVWULEXWHGWR VHULRXVFULPH ȴUHDUPVFRQVXPHUVHDFK\HDU SUICIDE PREVENTION FIREARM SAFETY LITERATURE AND VIDEOS 7KH166)ZRUNVZLWKWKH9HWHUDQV$GPLQLVWUDWLRQWKH 2XUVSRQVRUVKLSVSURYLGHVXSSRUWIRU166)ȇV 'HSDUWPHQWRI'HIHQVHWKH6WDWHRI8WDKDQGPHQWDOKHDOWK ȴUHDUPVVDIHW\OLWHUDWXUHDQGYLGHRVZKLFK DJHQFLHVWRKHOSHGXFDWHȴUHDUPRZQHUVDQGWKHSXEOLFRQ LQFOXGH)LUHDUPV5HVSRQVLELOLW\LQWKH+RPH KRZWRNHHSȴUHDUPVRXWRIUHDFKRIWKRVHZKRGXULQJD )LUHDUPV6DIHW\'HSHQGVRQ<RXDQG)LUHDUPV SHULRGRIGHVSDLUPLJKWGRWKHPVHOYHVKDUP:HMRLQWKH166) 6DIHW\LQ9HKLFOHV LQVXSSRUWLQJWKH$PHULFDQ)RXQGDWLRQIRU6XLFLGH3UHYHQWLRQȇV 3URMHFWDQLQLWLDWLYHWRUHGXFHWKHDQQXDOVXLFLGHUDWH FIXNICS® 7KHȴUHDUPVLQGXVWU\KDVOHGWKHZD\LQLPSURYLQJ OPERATION SECURE STORE® WKH)%Ζ1DWLRQDOΖQVWDQW&ULPLQDO%DFNJURXQG 2SHUDWLRQ6HFXUH6WRUHLVDFRRSHUDWLYHLQLWLDWLYHEHWZHHQ &KHFN6\VWHP 1Ζ&6 WRKHOSNHHSJXQVRXWRIWKH WKH166)DQGWKH$7)WRSURYLGHUHZDUGVIRULQIRUPDWLRQ KDQGVRIFULPLQDOVDQGSUHYHQWDQ\RQHZKRFDQQRW OHDGLQJWRWKHVXFFHVVIXODUUHVWRIFULPLQDOVUHVSRQVLEOHIRU OHJDOO\KDYHDJXQIURPJHWWLQJRQH$EDFNJURXQG VWHDOLQJȴUHDUPVIURPDQ))/$GGLWLRQDOO\WKH166)LVKHOSLQJ