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What changed in Clarus Corp's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Clarus Corp's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+292 added−262 removedSource: 10-K (2026-03-05) vs 10-K (2025-03-06)

Top changes in Clarus Corp's 2025 10-K

292 paragraphs added · 262 removed · 199 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeIntellectual Property We believe our registered and pending word and icon trademarks worldwide, including the Black Diamond and Diamond “C” logos, Black Diamond®, ATC ®, Camalot®, AvaLung ®, FlickLock®, Ascension™, Time is Life®, Hexentric®, Stopper®, Dawn Patrol®, 9 Table of Contents Bibler®, “Use.Design.Engineer.Build.Repeat”®, PIEPS®, Rhino-Rack®, Maxtrax®, RockyMounts®, and TRED™ create international brand recognition for our products.
Biggest changeIntellectual Property We believe our registered and pending word and icon trademarks worldwide, including the Black Diamond and Diamond “C” logos, Black Diamond®, ATC ®, Camalot®, AvaLung ®, FlickLock®, Ascension™, Time is Life®, Hexentric®, Stopper®, Dawn Patrol®, Bibler®, “Use.Design.Engineer.Build.Repeat”®, Rhino-Rack®, Maxtrax®, RockyMounts®, and TRED™ create international brand recognition for our products. 9 Table of Contents Solely for convenience, our trademarks and tradenames referred to in this report may appear without the ® and ™ symbols, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights, or the right of the applicable licensor to these trademarks and tradenames.
We also offer advanced skis, ski poles, ski skins, and snow safety products, including avalanche airbag systems, avalanche transceivers, shovels, and probes. ● Our Adventure segment, which includes Rhino-Rack, MAXTRAX, and TRED, is a manufacturer of highly-engineered automotive roof racks, trays, mounting systems, luggage boxes, carriers, recovery boards, bicycle racks, and accessories in Australia and New Zealand and a growing presence in the United States.
We also offer advanced skis, ski poles, ski skins, and snow safety products, including avalanche airbag systems, avalanche transceivers, shovels, and probes. ● Our Adventure segment, which includes Rhino-Rack, MAXTRAX, TRED, and RockyMounts is a manufacturer of highly-engineered automotive roof racks, trays, mounting systems, luggage boxes, carriers, recovery boards, bicycle racks, and accessories in Australia and New Zealand and a growing presence in the United States.
Due to its overlap with numerous outdoor lifestyle activities, overlanding’s market growth is difficult to precisely measure, but we believe that the global adventure tourism market — which includes camping, hiking, mountain biking, kayaking, rafting and other pursuits that are closely associated with overlanding — reflects this growing trend and is expected to continue to grow in the coming years.
Due to its overlap with numerous outdoor lifestyle activities, overlanding’s market growth is difficult to precisely measure, but we believe that the global adventure tourism market — which includes camping, hiking, biking, kayaking, rafting and other pursuits that are closely associated with overlanding — reflects this growing trend and is expected to continue to grow in the coming years.
Each of our brands has a long history of continuous product innovation for core and everyday users alike. The Company’s products are principally sold globally under the Black Diamond®, Rhino-Rack®, MAXTRAX®, and TRED Outdoors® brand names through outdoor specialty and online retailers, our own websites, distributors and original equipment manufacturers.
Each of our brands has a long history of continuous product innovation for core and everyday users alike. The Company’s products are principally sold globally under the Black Diamond®, Rhino-Rack®, MAXTRAX®, TRED Outdoors®, and RockyMounts® brand names through outdoor specialty and online retailers, our own websites, distributors and original equipment manufacturers.
The Black Diamond Equipment, PIEPS, and Rhino-Rack manufacturing and distribution operations are ISO 9001–2015 certified and are audited annually by an independent certifying agency to ensure quality management systems meet the requirements of ISO 9001–2015, and to ensure that certified products meet all necessary performance certification requirements. All products are manufactured to our specifications in third-party, independently-owned facilities.
The Black Diamond Equipment, and Rhino-Rack manufacturing and distribution operations are ISO 9001–2015 certified and are audited annually by an independent certifying agency to ensure quality management systems meet the requirements of ISO 9001–2015, and to ensure that certified products meet all necessary performance certification requirements. All products are manufactured to our specifications in third-party, independently-owned facilities.
Our debt-free capital structure as of December 31, 2024, provides us with the capacity to fund future growth. 6 Table of Contents Operating Segments We operated our business within three segments until the sale of the Precision Sport segment on February 29, 2024. After the sale of the Precision Sport segment, we operate the business within two segments.
Our debt-free capital structure as of December 31, 2025, provides us with the capacity to fund future growth. 6 Table of Contents Operating Segments We operated our business within three segments until the sale of the Precision Sport segment on February 29, 2024. After the sale of the Precision Sport segment, we operate the business within two segments.
We make available free of charge on or through our website our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports, and the proxy statement for our annual meeting of stockholders as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission.
We make available free of charge on or through our website our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports, and the proxy statement for our annual meeting of stockholders as soon as reasonably practicable after we electronically file such material with, or furnish it to, 10 Table of Contents the Securities and Exchange Commission.
Our commitment to quality, rigorous safety, and ultimately best-in-class design is evidenced by outstanding industry recognition, as we have received numerous product awards across our portfolio of brands. Each of our segments address a unique customer value proposition through our brands.
Our commitment to quality, rigorous safety, and ultimately best-in-class design is evidenced by outstanding industry recognition, as we have received numerous product awards across our portfolio of brands. Each of our segments addresses a unique customer value proposition through our brands.
Combining off-road driving with backcountry lifestyle activities, such as camping, hiking, kayaking and mountain biking, we believe that overlanding has driven a new niche in the light truck, SUV and CUV segment for enthusiasts and light truck manufacturers, which is expected to directly benefit our Rhino-Rack, MAXTRAX, and TRED brands.
Combining off-road driving with backcountry lifestyle activities, such as camping, hiking, kayaking and mountain biking, we believe that overlanding has driven a new niche in the light truck, SUV and CUV segment for enthusiasts and light truck manufacturers, which is expected to directly benefit our Rhino-Rack, MAXTRAX, TRED, and RockyMounts brands, especially in Australia.
Headquartered in Salt Lake City at the base of the Wasatch Mountains, Black Diamond products are created and tested locally on its alpine peaks, slopes, crags and trails. Continuously recognized as an industry-leading innovator, Black Diamond has received over 500 industry awards over five years, including over 250 product awards in 2024 alone.
Headquartered in Salt Lake City at the base of the Wasatch Mountains, Black Diamond products are created and tested locally on its alpine peaks, slopes, crags and trails. Continuously recognized as an industry-leading innovator, Black Diamond has received over 500 industry awards over five years, including over 225 product awards in 2025 alone.
Select factors driving this acceleration include: Increasing Adoption of Outdoor Lifestyles and Focus on Health and Wellness . According to Outdoor Foundation, a non-profit dedicated to getting people outside for their health, over the past decade, many outdoor activities have experienced a consistent rise in participation rates.
Select factors driving this acceleration include: Increasing Adoption of Outdoor Lifestyles and Focus on Health and Wellness . According to Outdoor Foundation, a non-profit dedicated to getting people outside for their health, many outdoor activities have experienced a consistent rise in participation rates.
Of these employees, 50 were engaged in manufacturing, 220 in sales, marketing, product management and customer support, 70 in administrative functions (IT, Finance, HR, Legal and Compliance, etc.), 90 in R&D, engineering technology, manufacturing engineering and project management, 30 retail store associates and 10 in various executive and corporate functions.
Of these employees, 30 were engaged in manufacturing, 220 in sales, marketing, product management and customer support, 50 in administrative functions (IT, Finance, HR, Legal and Compliance, etc.), 60 in R&D, engineering technology, manufacturing engineering and project management, 20 retail store associates and 10 in various executive and corporate functions.
Each of our brands is synonymous with the sport it serves, tracing its roots to the modern origins of each sport. ● Since 1957, our Black Diamond brand has been a global innovator in activity-based climbing, skiing, and mountain sports equipment. ● Our Rhino-Rack brand was founded in 1992 and has become well-respected and widely recognized for outdoor enthusiasts. ● Our MAXTRAX brand was founded in 2005 and has become the market leader in recovery boards for overlanding enthusiasts. ● Our TRED brand was founded in 2012 and offers high-quality, reliable outdoor and recovery gear for the offroad, 4x4 automotive touring, camping and caravanning markets. ​ Our brands also appeal to everyday customers seeking high-quality products for outdoor or urban and suburban living.
Each of our brands is synonymous with the sport it serves, tracing its roots to the modern origins of each sport. ● Since 1957, our Black Diamond brand has been a global innovator in activity-based climbing, skiing, and mountain sports equipment. ● Our Rhino-Rack brand was founded in 1992 and has become well-respected and widely recognized for outdoor enthusiasts. ● Our MAXTRAX brand was founded in 2005 and has become the market leader in recovery boards for overlanding enthusiasts. ● Our TRED brand was founded in 2012 and offers high-quality, reliable outdoor and recovery gear for the offroad, 4x4 automotive touring, camping and caravanning markets. ● Our RockyMounts brand was founded in 1993 and is known for making well designed and dependable premium bicycle racks and other accessories compatible with vehicles of all sizes. ​ Our brands also appeal to everyday customers seeking high-quality products for outdoor or urban and suburban living.
Warren Kanders, are substantial stockholders of the Company, and beneficially own approximately 22.2% of our outstanding common stock as of March 6, 2025, which we believe aligns the interests of our Board of Directors and our executive officers with that of our stockholders. Growth-oriented Capital Structure.
Warren Kanders, are substantial stockholders of the Company, and beneficially own approximately 23.5% of our outstanding common stock as of March 5, 2026, which we believe aligns the interests of our Board of Directors and our executive officers with that of our stockholders. Growth-oriented Capital Structure.
See Note 18 to our consolidated financial statements for financial information regarding our segments. Also, see Note 3 to our consolidated financial statements for financial information regarding our Precision Sport segment which is now classified as discontinued operations.
See Note 18 to our consolidated financial statements for financial information regarding our segments. Also, see Note 3 to our consolidated financial statements for financial information regarding our Precision Sport segment, which is now classified as discontinued operations, as well as a description of the sale of PIEPS.
Rhino-Rack is based in Sydney, Australia, bringing a leading market position in its home markets of Australia and New Zealand, with opportunities to grow in the U.S., Europe, the Middle East and other Asia-Pacific countries, where we believe that the brand currently has less than 1% market share. Acquisition of Complementary Businesses.
Rhino-Rack is based in Sydney, Australia, bringing a leading market position in its home markets of Australia and New Zealand, with opportunities to grow in the U.S., Europe, the Middle East and other Asia-Pacific countries, where we believe that the brand currently has less than 1% market share. 4 Table of Contents Competitive Strengths Authentic Portfolio of Iconic Enthusiast Brands.
Each segment is described below: ● Our Outdoor segment, which includes Black Diamond Equipment and PIEPS, is a global leader in designing, manufacturing, and marketing innovative outdoor engineered equipment and apparel for climbing, mountaineering, trail running, backpacking, skiing, and a wide range of other year-round outdoor recreation activities.
Each segment is described below: ● Prior to its sale on July 11, 2025, PIEPS was included in our Outdoor segment alongside Black Diamond Equipment. Our Outdoor segment is a global leader in designing, manufacturing, and marketing innovative outdoor engineered equipment and apparel for climbing, mountaineering, trail running, backpacking, skiing, and a wide range of other year-round outdoor recreation activities.
Due to the nature of our operations and the frequently changing nature of environmental compliance standards and technology, we cannot predict with any certainty that future material capital or operating expenditures will not be required in order to comply with applicable environmental laws and regulations. 10 Table of Contents Human Capital As of December 31, 2024, our continuing operations had a total of over 470 employees worldwide.
Due to the nature of our operations and the frequently changing nature of environmental compliance standards and technology, we cannot predict with any certainty that future material capital or operating expenditures will not be required in order to comply with applicable environmental laws and regulations.
We compete with niche, privately-owned companies as well as a number of brands owned by large, multinational companies, such as those set forth below. ● Outdoor: Our outdoor products and accessories, such as apparel, footwear, trekking poles, headlamps, gloves, backpacks, transceivers, protection, carabiners, helmets, and harnesses, compete with products from companies such as The North Face, Patagonia, La Sportiva, Prana, Hestra, Osprey, Arc’Teryx, Petzl, and Mammut. ● Adventure: Our highly-engineered automotive roof racks, trays, mounting systems, luggage boxes, carriers, recovery tracks and accessories compete with products from companies such as Thule, Dometic, Yakima, and Front Runner. ● Precision Sport: Our former Precision Sport segment sold bullets and ammunition to both retailers and distributors for sale to consumers as well as supplies bullets to OEMs who also manufacture bullets.
We compete with niche, privately-owned companies as well as a number of brands owned by large, multinational companies, such as those set forth below. ● Outdoor: Our outdoor products and accessories, such as apparel, footwear, trekking poles, headlamps, gloves, backpacks, transceivers, protection, carabiners, helmets, and harnesses, compete with products from companies such as The North Face, Patagonia, La Sportiva, Prana, Hestra, Osprey, Arc’Teryx, Petzl, and Mammut. ● Adventure: Our highly-engineered automotive roof racks, trays, mounting systems, luggage boxes, carriers, recovery tracks and accessories compete with products from companies such as Thule, Dometic, Yakima, and Front Runner. ​ In addition, in certain categories we compete with certain of our large wholesale customers who focus on the outdoor market, such as REI, Mountain Equipment Co-op and Decathlon, which manufacture, market and distribute their own climbing, mountaineering, and skiing products under their own private labels.
In October 2012, we acquired PIEPS Holding GmbH and its subsidiaries (collectively, “PIEPS”). On August 14, 2017, the Company changed its name from Black Diamond, Inc. to Clarus Corporation and its stock ticker symbol from “BDE” to “CLAR” on the NASDAQ stock exchange. On July 1, 2021, the Company completed the acquisition of Australia-based Rhino-Rack Holdings Pty Ltd (“Rhino-Rack”).
(“Black Diamond Equipment”) in May 2010 and changed its name to Black Diamond, Inc. in January 2011. In October 2012, we acquired PIEPS Holding GmbH and its subsidiaries (collectively, “PIEPS”). On August 14, 2017, the Company changed its name from Black Diamond, Inc. to Clarus Corporation and its stock ticker symbol from “BDE” to “CLAR” on the NASDAQ stock exchange.
We believe the credibility and authenticity of our brands expands our potential market beyond committed outdoor athletes to outdoor generalists who desire to lead active, outdoor-focused lifestyles. Growth Strategies Our growth strategies are to achieve sustainable, profitable growth organically while seeking to expand our business through targeted, strategic acquisitions.
We believe the credibility and authenticity of our brands expands our potential market beyond committed outdoor athletes to outdoor generalists who desire to lead active, outdoor-focused lifestyles.
(“Sierra”) and Barnes Bullets – Mona, LLC (“Barnes”), pursuant to a Purchase and Sale Agreement dated as of December 29, 2023, by and among, Bullseye Acquisitions, LLC, Everest/Sapphire Acquisition, LLC and the Company (the “Precision Sport Purchase Agreement”).
(“Sierra”) and Barnes Bullets – Mona, LLC (“Barnes”), pursuant to a Purchase and Sale Agreement dated as of December 29, 2023.
Our employees’ passion and intimacy with our core outdoor activities generates new and boundary-pushing concepts and products, which we believe provides a significant advantage that will drive our Company to new levels. We seek to design products that enhance our customers’ personal performance as they participate in the activities we serve.
Product Innovation and Development Capabilities at Clarus . We have a long history of technical innovation and product development. Our employees’ passion and intimacy with our core outdoor activities generates new and boundary-pushing concepts and products, which we believe provides a significant advantage that will drive our Company to new levels.
We integrate quality assurance and quality control teams throughout the entire design process to maintain the quality and integrity for which our brands are known. We believe that our vertically integrated design and development process and enthusiastic employee base provide us with a competitive advantage to continue to drive future innovation for our Company and the markets we serve.
We believe that our vertically integrated design and development process and enthusiastic employee base provide us with a competitive advantage to continue to drive future innovation for our Company and the markets we serve. Experienced and Incentivized Senior Management Team. The members of our Board of Directors and our executive officers, including Mr.
Founded in 2012, our TRED brand offers high-quality, reliable outdoor and recovery gear for the offroad, 4x4 automotive touring, camping and caravanning markets. Clarus, incorporated in Delaware in 1991, acquired Black Diamond Equipment, Ltd. (“Black Diamond Equipment”) in May 2010 and changed its name to Black Diamond, Inc. in January 2011.
Founded in 2012, our TRED brand offers high-quality, reliable outdoor and recovery gear for the offroad, 4x4 automotive touring, camping and caravanning markets. Founded in 1993, our RockyMounts brand is known for making well designed and dependable premium bicycle racks and other accessories compatible with vehicles of all sizes. Clarus, incorporated in Delaware in 1991, acquired Black Diamond Equipment, Ltd.
Precision Sport The activities of the Precision Sport segment have been segregated and reported as discontinued operations for all periods presented. See Note 3 to our consolidated financial statements for financial information regarding discontinued operations. Sierra: Sierra Bullets is dedicated to manufacturing the highest-quality, most accurate bullets and ammunition in the world.
Precision Sport The activities of the Precision Sport segment have been segregated and reported as discontinued operations for the years ended December 31, 2024 and 2023. There was no activity in discontinued operations during the year ended December 31, 2025. See Note 3 to our consolidated financial statements for financial information regarding discontinued operations.
Working capital generally increases to support peak manufacturing and shipping periods and then decreases as accounts receivable are collected.
In 2025, approximately 46% of our sales were in the first half of the year while approximately 54% of our sales occurred in the second half of the year. Working capital requirements vary throughout the year. Working capital generally increases to support peak manufacturing and shipping periods and then decreases as accounts receivable are collected.
On December 1, 2021, the Company completed the acquisition of Australia-based MaxTrax Australia Pty Ltd (“MAXTRAX”). On October 9, 2023, the Company completed the acquisition of Australia-based TRED Outdoors Pty Ltd. (“TRED”). On December 5, 2024, the Company completed the acquisition of certain assets and liabilities constituting the RockyMounts business (“RockyMounts”), a Colorado-based brand specializing in bicycle transport products.
On July 1, 2021, the Company completed the acquisition of Australia-based Rhino-Rack Holdings Pty Ltd (“Rhino-Rack”). On December 1, 2021, the Company completed the acquisition of Australia-based MaxTrax Australia Pty Ltd (“MAXTRAX”). On October 9, 2023, the Company completed the acquisition of Australia-based TRED Outdoors Pty Ltd. (“TRED”).
TRED’s products, which are synonymous with quality and engineering, are all made in Australia using Australian-sourced and tested high-grade materials. TRED is a trusted brand for key retailers and distributors primarily in Australia, with a growing export market including Canada, the Middle East, New Zealand, South Africa, and the U.S.
TRED’s products, which are synonymous with quality and engineering, are all made in Australia using Australian-sourced and tested high-grade materials.
On February 29, 2024, the Company and Everest/Sapphire Acquisition, LLC, its wholly-owned subsidiary, completed the sale to Bullseye Acquisitions, LLC, an affiliate of JDH Capital Company, of all of the equity associated with the Company’s Precision Sport segment, which is comprised of the Company’s subsidiaries Sierra Bullets, L.L.C.
On December 5, 2024, the Company completed the acquisition of certain assets and liabilities constituting the RockyMounts business (“RockyMounts”), a Colorado-based brand specializing in bicycle transport products. On February 29, 2024, the Company completed the sale of all of the equity associated with the Company’s Precision Sport segment, which was comprised of the Company’s subsidiaries Sierra Bullets, L.L.C.
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Under the terms of the Precision Sport Purchase Agreement, the Company received net proceeds of approximately $37,871,000 in cash, after payment of certain fees and settlement of the Restated Credit Agreement (as defined below), for all of the equity associated with the Company’s Precision Sport segment.
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On May 8, 2025, BD European Holdings, LLC, a Delaware limited liability company and wholly owned subsidiary of the Company, entered into a Share Purchase and Transfer Agreement (the “Share Purchase Agreement”) to sell all of the issued and outstanding shares of Black Diamond Austria GmbH, together with its operating subsidiary, PIEPS GmbH (collectively, “PIEPS”).
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The activities of the Precision Sport segment have been segregated and reported as discontinued operations for all periods presented. See Note 3 to our consolidated financial statements for financial information regarding discontinued operations. 3 Table of Contents Market Overview Our brands participate in the outdoor-oriented lifestyle that has and is expected to benefit from favorable long-term growth trends.
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On July 11, 2025, the Company completed the sale of PIEPS, which was included in the Company’s Outdoor segment, to a private investment firm for a total purchase price of €7,825,000 (approximately $9,124,000), including cash held at PIEPS of $1,311,000, pursuant to the Share Purchase Agreement. 3 Table of Contents Market Overview Our brands participate in the outdoor-oriented lifestyle that has and is expected to benefit from favorable long-term growth trends.
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We expect to target acquisitions as a viable opportunity to gain access to new product groups and customer channels, and increase penetration of existing markets. We may also pursue acquisitions that diversify the Company 4 Table of Contents within the outdoor enthusiast markets.
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Growth Strategies Our growth strategies are to achieve sustainable, profitable growth organically through the execution of targeted growth initiatives, including simplification of certain products, product lines and business units to drive targeted growth and margin improvement.
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To the extent we pursue future acquisitions, we intend to focus on enthusiast brands with recurring revenue, sustainable margins and strong cash flow generation. We anticipate financing future acquisitions prudently through a combination of cash on hand, operating cash flow, bank financings, and capital markets offerings. Competitive Strengths Authentic Portfolio of Iconic Enthusiast Brands.
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TRED is a trusted brand for key retailers and distributors primarily in Australia, with a growing export market including Canada, the Middle East, New Zealand, South Africa, and the U.S. ​ RockyMounts : Founded in 1993, RockyMounts is known for making well designed and dependable premium bicycle racks and other accessories compatible with vehicles of all sizes, including SUVs, vans and trucks.
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From local and international shooting competitions to sport and hunting, Sierra is synonymous with precision, providing critical dependability to hunting and sport shooting enthusiasts. This performance is born from a proprietary manufacturing, testing and quality assurance process that enables the achievement of the tightest tolerances in the industry.
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RockyMounts has designed innovative roof and hitch rack solutions, attracting a dedicated following of customers thanks to the products’ distinct style and exceptional durability. Its award-winning products can be found in local and national retailers primarily in North America.
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Sierra’s bullets and ammunition are used for precision target shooting, hunting and defense purposes. Sierra’s products have cultivated a significant consumer following recognized by iconic “green box” packaging and include globally recognized bullet brands such as Sierra® MatchKing®, Sierra® GameKing® and Sierra® BlitzKing® and ammunition brands such as GameChanger®, Prairie Enemy TM , Outdoor Master® and Sport Master®.
Added
We seek to design products that enhance our customers’ personal performance as they participate in the activities we serve. We integrate quality assurance and quality control teams throughout the entire design process to maintain the quality and integrity for which our brands are known.
Removed
Barnes: Barnes Bullets is an industry leader in all-copper bullet technology and innovation. The company manufactures some of the world’s most technologically advanced lead-free bullets and premium hunting, self-defense and tactical ammunition. Barnes has earned its strong reputation through unrivaled performance and terminal results.
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Human Capital As of December 31, 2025, we had a total of over 390 employees worldwide.
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This reputation is defined by innovative design, advanced manufacturing techniques and a core focus on the end-user. As a result, Barnes has generated a strong consumer following supported by its globally recognized bullet brands such as Barnes® TSX®, X Bullet®, Varmint Grenade® and Expander® and ammunition brands VOR-TX® and TAC-XPD®.
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With its products being sold through its online store, a variety of retailers and international distributors, Barnes’ customers include hunters, range shooters, military and law enforcement professionals around the world. Product Innovation and Development Capabilities at Clarus . We have a long history of technical innovation and product development.
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Experienced and Incentivized Senior Management Team. The members of our Board of Directors and our executive officers, including Mr.
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Such companies include Vista (Federal Ammunition, CCI, and Remington), Nammo, Hornady, Fiocchi, and Olin (Winchester). ​ In addition, in certain categories we compete with certain of our large wholesale customers who focus on the outdoor market, such as REI, Mountain Equipment Co-op and Decathlon, which manufacture, market and distribute their own climbing, mountaineering, and skiing products under their own private labels.
Removed
Solely for convenience, our trademarks and tradenames referred to in this report may appear without the ® and ™ symbols, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights, or the right of the applicable licensor to these trademarks and tradenames.
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In 2024, approximately 48% of our sales from continuing operations were in the first half of the year while approximately 52% of our sales from continuing operations occurred in the second half of the year. Working capital requirements vary throughout the year.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeDepartment of Justice to commence an investigation. ● Our products, including, without limitation, certain models of our avalanche transceivers, have been subject to adverse publicity. ● Some of our products and inventory contain Per- and Polyfluoroalkyl Substances (PFAS), which have resulted in charges in 2024 due to regulatory compliance costs, potential remediation efforts, and litigation risks. ● Our markets are highly competitive and are subject to dramatic changes in consumer preferences. ● Our operations, including but not limited to integrating acquisitions and our purchase of raw materials, are sensitive to changes in global cultural, political, and financial market conditions as well as potential changes in regulations, legislation and government policies. 11 Table of Contents ● Technological advances, the introduction of new products, and new design and manufacturing techniques could adversely affect our operations unless we are able to adapt to the resulting change in conditions. ● We may require additional capital and funding to meet our financial obligations as well as to support our business operations and growth strategy, and this additional capital and funding may not be available on acceptable terms or at all. ● We may be unsuccessful in our future acquisition endeavors, if any, which may have an adverse effect on our business; in addition, some of the businesses we acquire may incur significant losses from operations. ● We have been required to recognize significant impairment charges and may be required to take future write downs or write-offs, restructuring, and impairment or other charges. ● Our business and growth may suffer if we are unable to attract and retain key officers or employees, including our Chief Executive Officer, Warren Kanders, as well as any loss of officers or employees due to illness or other events outside of our control. ● The members of our Board of Directors and our executive officers beneficially own in excess of approximately 22.2% of our common stock.
Biggest changeDepartment of Justice to commence an investigation. ● Compliance costs and potential liabilities related to environmental requirements, including those associated with Per- and Polyfluoroalkyl Substances (PFAS), could negatively impact our financial results. ● Our markets are highly competitive and are subject to dramatic changes in consumer preferences. ● Our operations, including, among other things, integrating acquisitions and procuring raw materials, are sensitive to changes in global cultural, political, and financial market conditions, as well as potential changes in regulations, legislation, and government policies. ● Changes in tariffs, tax laws, global trade policies and instability and volatility in global markets could adversely affect our business and results of operations. ● Disruptions in our supply chain, third-party logistics providers, or distribution facilities could adversely affect our business, results of operations, and financial condition. ● If we are unable to accurately forecast demand and manage inventory levels, we may experience excess or obsolete inventory, discounting, or lost sales. ● Technological advances, the introduction of new products, and new design and manufacturing techniques could adversely affect our operations unless we are able to adapt to changing conditions. ● If we fail to adequately protect our intellectual property rights, competitors may manufacture and market products similar to ours, which could adversely affect our market share and results of operations. ● We may require additional capital and funding to meet our financial obligations as well as to support our business operations and growth initiatives, and this additional capital and funding may not be available on favorable terms, if at all. ● We may be unsuccessful in our future acquisition endeavors and some of the businesses we acquire may incur significant losses from operations. ● We have been required to recognize significant impairment charges and may be required to take future write-downs or write-offs, restructuring, and impairment or other charges. 11 Table of Contents ● Our business and growth may suffer if we are unable to attract and retain key officers or employees, including our Chief Executive Officer, Warren Kanders, or if we experience unexpected loss of key personnel. ● We may be subject to disruptions, failures or cyber-attacks in our information technology systems and network infrastructures that could disrupt our operations, damage our reputation and adversely affect our business, operations, and financial results. ● The effects of climate change and increased focus by stakeholders on sustainability and ESG matters may adversely affect our business and financial results and damage our reputation. ● The members of our Board of Directors and our executive officers beneficially own approximately 23.5% of our outstanding common stock, which may limit other stockholders’ ability to influence corporate matters. ​ Risks Related to Our Industry Many of the products we sell are used for inherently risky outdoor pursuits and have given rise to product liability or product warranty claims and other loss contingencies including, without limitation, recalls and liability claims relating to BDEL’s avalanche beacon transceivers, which could affect our earnings and financial condition.
Fear of contracting diseases, individuals contracting diseases and the actions taken, and that may be taken, by governmental authorities, our third-party logistics providers, our landlords, our competitors or by us relating to diseases, analogous to the COVID-19 pandemic may: ● cause disruptions in the supply chain, including the ability to produce and deliver product as expected; ● result in canceled orders, non-payment for orders received and/or delayed payment for orders received; ● restrict the operation of our retail store operations and our ability to meet consumer demand at our stores; ● cause inflation and currency rate fluctuations; ● result in a misalignment between demand and supply; ● result in labor shortages, including as a result of any vaccine mandate or our return to work policies; ● increase reliance by consumers on e-commerce platforms; ● impair the financial health of certain of our customers; ● impact previous business assumptions; ● increase the reliance of our employees on digital solutions; ● restrict global business and travel; ● impair our ability to ship product through our owned or affiliated distribution centers, including as a result of capacity reductions, shift changes, labor shortages, higher than normal absenteeism and/or the complete shutdowns of facilities for deep cleaning procedures; ● cause rapid changes to employment and tax law; ● impair our key personnel; ● result in incremental costs from the adoption of preventative measures, including providing facial coverings and hand sanitizer, rearranging operations to follow social distancing protocols, conducting temperature checks and undertaking regular and thorough disinfecting of surfaces, and providing testing; and/or ● cause any number of other disruptions to our business, the risks of which may be otherwise identified herein.
Fear of contracting diseases, individuals contracting diseases and the actions taken, and that may be taken, by governmental authorities, our third-party logistics providers, our landlords, our competitors or by us relating to diseases, analogous to the COVID-19 pandemic may: ● cause disruptions in the supply chain, including the ability to produce and deliver product as expected; ● result in canceled orders, non-payment for orders received and/or delayed payment for orders received; ● restrict the operation of our retail store operations and our ability to meet consumer demand at our stores; ● cause inflation and currency rate fluctuations; ● result in a misalignment between demand and supply; ● result in labor shortages, including as a result of any vaccine mandate or our return to work policies; ● increase reliance by consumers on e-commerce platforms; ● impair the financial health of certain of our customers; ● impact previous business assumptions; 20 Table of Contents ● increase the reliance of our employees on digital solutions; ● restrict global business and travel; ● impair our ability to ship product through our owned or affiliated distribution centers, including as a result of capacity reductions, shift changes, labor shortages, higher than normal absenteeism and/or the complete shutdowns of facilities for deep cleaning procedures; ● cause rapid changes to employment and tax law; ● impair our key personnel; ● result in incremental costs from the adoption of preventative measures, including providing facial coverings and hand sanitizer, rearranging operations to follow social distancing protocols, conducting temperature checks and undertaking regular and thorough disinfecting of surfaces, and providing testing; and/or ● cause any number of other disruptions to our business, the risks of which may be otherwise identified herein.
These include the burdens of complying with a variety of foreign laws and regulations, unexpected changes in regulatory requirements, new tariffs or other barriers to some international markets.
These risks include the burdens of complying with a variety of foreign laws and regulations, unexpected changes in regulatory requirements, new tariffs or other barriers to some international markets.
The Amendment generally restricts direct and indirect acquisitions of our equity securities if such acquisition will affect 27 Table of Contents the percentage of the Company’s capital stock that is treated as owned by a “5% stockholder.” Additionally, on September 5, 2024, our Board of Directors approved an amendment to, our rights agreement dated February 7, 2008, which is designed to assist in limiting the number of 5% or more owners and thus reduce the risk of a possible “change of ownership” under Section 382 of the Code.
The Amendment generally restricts direct and indirect acquisitions of our equity securities if such acquisition will affect the percentage of the Company’s capital stock that is treated as owned by a “5% stockholder.” Additionally, on September 5, 2024, our Board of Directors approved an amendment to our rights agreement dated February 7, 2008, which is designed to assist in limiting the number of 5% or more owners and thus reduce the risk of a possible “change of ownership” under Section 382 of the Code.
Any of the following factors could materially and adversely affect our ability to obtain the necessary additional capital and funding required to meet financial obligations as well as support our ongoing business operations and growth strategy: ● fluctuations in economic conditions and adverse market conditions; ● unforeseen economic downturns, shifts in investor sentiment, or changes in market trends; ● intense competition in the capital markets may limit our attractiveness to potential investors or lenders which may expose us to the risk of unfavorable financing arrangements; ● any downturn in our financial performance, failure to meet projections and/or deterioration of our credit profile may undermine investor or lender confidence, making it difficult to secure additional capital and funding; and ● events of global significance, such as economic recessions, geopolitical tensions, or pandemics, can disrupt financial markets and impact investor or lender willingness to provide capital and funding. ​ In addition, if we issue equity or debt securities to raise additional funds, (i) we will incur fees associated with such issuance, (ii) our existing stockholders will experience dilution from the issuance of new equity securities, (iii) we will incur ongoing interest expense and may be required to grant a security interest in our assets in connection with any debt issuance, and (iv) any new equity or debt securities may have rights, preferences and privileges senior to those of our existing stockholders.
Any of the following factors could materially and adversely affect our ability to obtain the necessary additional capital and funding required to meet financial obligations as well as support our ongoing business operations and growth initiatives: ● fluctuations in economic conditions and adverse market conditions (including higher interest rates and tighter credit conditions); ● unforeseen economic downturns, shifts in investor sentiment, or changes in market trends; ● intense competition in the capital markets may limit our attractiveness to potential investors or lenders which may expose us to the risk of unfavorable financing arrangements; ● any downturn in our financial performance, failure to meet projections and/or deterioration of our credit profile may undermine investor or lender confidence, making it difficult to secure additional capital and funding; and ● events of global significance, such as economic recessions, geopolitical tensions, or pandemics, can disrupt financial markets and impact investor or lender willingness to provide capital and funding. ​ In addition, if we issue equity or debt securities to raise additional funds, (i) we will incur fees associated with such issuance, (ii) our existing stockholders will experience dilution from the issuance of new equity securities, (iii) we will incur ongoing interest expense and may be required to grant a security interest in our assets in connection with any debt issuance, and (iv) any new equity or debt securities may have rights, preferences and privileges senior to those of our existing stockholders.
For example, any future withdrawal or renegotiation of trade agreements, and the prosecution of trade disputes or the imposition of tariffs, duties, taxes and other charges on imports or exports between the United States and countries like China, Canada and Mexico may adversely affect our ability to operate our business and execute our growth strategy.
For example, any future withdrawal or renegotiation of trade agreements, and the prosecution of trade disputes or the imposition of tariffs, duties, taxes and other charges on imports or exports between the United States and countries like China, Canada and Mexico may adversely affect our ability to operate our business and execute our growth initiatives.
Injuries sustained by those who use or purchase our products, including, without limitation, BDEL’s avalanche beacon transceivers, have, and could in the future, subject us to regulatory proceedings and litigation by government agencies and private litigants brought against us, that regardless of their merits, could harm our reputation, divert management’s attention from our operations and result in substantial legal fees and other costs.
Injuries sustained by those who use or purchase our products, including, without limitation, BDEL’s avalanche beacon transceivers, have, and could in the future, subject us to regulatory proceedings and litigation by government agencies and private litigants brought against us, that 13 Table of Contents regardless of their merits, could harm our reputation, divert management’s attention from our operations and result in substantial legal fees and other costs.
Our business, financial condition and results of operations and cash flows, as well as the trading price of our common stock may be negatively impacted by the effects of a disease outbreak, epidemic, pandemic, or similar widespread public health concern, such as travel restrictions or recommendations or mandates from governmental authorities to avoid large gatherings or to self-quarantine, whether as a result of the COVID-19 or coronavirus global pandemic or otherwise.
Our business, financial condition and results of operations and cash flows, as well as the trading price of our common stock may be negatively impacted by the effects of a disease outbreak, epidemic, pandemic, or similar widespread public health concern, such as travel restrictions or recommendations or mandates from governmental authorities to avoid large gatherings or to self-quarantine, whether as a result of a global pandemic or otherwise.
This volatility can significantly affect the availability and cost of raw materials for us, and may therefore have a material adverse effect on our business, results of operations, and financial condition. 18 Table of Contents During periods of rising prices of raw materials, there can be no assurance that we will be able to pass any portion of such increases on to customers.
This volatility can significantly affect the availability and cost of raw materials for us, and may therefore have a material adverse effect on our business, results of operations, and financial condition. During periods of rising prices of raw materials, there can be no assurance that we will be able to pass any portion of such increases on to customers.
These factors could cause investors to lose confidence in our reported financial information and could have a negative effect on the trading price of our stock. 24 Table of Contents We may be subject to disruptions, failures or cyber-attacks in our information technology systems and network infrastructures that could disrupt our operations, damage our reputation and adversely affect our business, operations, and financial results.
These factors could cause investors to lose confidence in our reported financial information and could have a negative effect on the trading price of our stock. We may be subject to disruptions, failures or cyber-attacks in our information technology systems and network infrastructures that could disrupt our operations, damage our reputation and adversely affect our business, operations, and financial results.
Any failure to adequately manage our growth could have a material adverse effect on the market price of our common stock and our business, financial condition, and results of operations. 23 Table of Contents Compliance with changing laws, regulations and standards of corporate governance and public disclosure may result in additional expenses.
Any failure to adequately manage our growth could have a material adverse effect on the market price of our common stock and our business, financial condition, and results of operations. Compliance with changing laws, regulations and standards of corporate governance and public disclosure may result in additional expenses.
Such a situation could be costly and time-consuming, and could divert management’s attention from our day-to-day operations. Even if such allegations are ultimately proven to be groundless, allegations against us could severely impact the market price of our common stock and our business operations. ITEM 1B. UNRESOLVED STAFF COMMENTS None. 30 Table of Contents
Such a situation could be costly and time-consuming, and could divert management’s attention from our day-to-day operations. Even if such allegations are ultimately proven to be groundless, allegations against us could severely impact the market price of our common stock and our business operations. ITEM 1B. UNRESOLVED STAFF COMMENTS None.
Further, our certificate of incorporation provides for blank check preferred stock, which allows our Board of Directors to issue preferred stock at any time with rights and designations set forth by our Board of Directors.
Further, our Amended and Restated Certificate of Incorporation provides for blank check preferred stock, which allows our Board of Directors to issue preferred stock at any time with rights and designations set forth by our Board of Directors.
Given the nature of the past industrial operations conducted by us and others at these properties, there can be no assurance that all potential instances of soil or groundwater contamination have been identified, even for those properties where an environmental site assessment has been conducted.
Given the nature of the past industrial operations conducted by us and 21 Table of Contents others at these properties, there can be no assurance that all potential instances of soil or groundwater contamination have been identified, even for those properties where an environmental site assessment has been conducted.
If the IRS were successful with respect to any such challenge, the potential tax benefit of the NOL carryforwards to us could be substantially reduced. Certain protective measures implemented by us to preserve our NOLs may not be effective or may have some unintended negative effects.
If the IRS were successful with respect to any such challenge, the potential tax benefit of the NOL carryforwards to us could be substantially reduced. 27 Table of Contents Certain protective measures implemented by us to preserve our NOLs may not be effective or may have some unintended negative effects.
If we are required to 12 Table of Contents remove, or if we voluntarily remove, our products from the market, our reputation could be tarnished and we might have large quantities of finished products that we are unable to sell. We spend substantial resources seeking to ensure compliance with governmental and other applicable standards.
If we are required to remove, or if we voluntarily remove, our products from the market, our reputation could be tarnished and we might have large quantities of finished products that we are unable to sell. We spend substantial resources seeking to ensure compliance with governmental and other applicable standards.
On the other hand, if we underestimate demand for our products, our manufacturing facilities or third-party manufacturers may not be able to produce products to meet customer requirements, and this could result in delays in the shipment of products and lost revenues, as well as damage to our reputation and customer relationships.
On the other hand, if we underestimate demand for our products, our third-party manufacturers may not be able to produce products to meet customer requirements, and this could result in delays in the shipment of products and lost revenues, as well as damage to our reputation and customer relationships.
As a result, these types of claims could have a material adverse effect on our business, results of operations, and financial condition. Our product liability insurance program is an occurrence-based program based on our current and historical claims experience and the availability and cost of insurance.
As a result, these types of claims could have a material adverse effect on our business, results of operations, and financial condition. 12 Table of Contents Our product liability insurance program is an occurrence-based program based on our current and historical claims experience and the availability and cost of insurance.
Unfavorable audit findings or tax rulings could result in payment of additional taxes, fines, and penalties for prior periods and could lead to higher tax rates in future periods. Tax laws and regulations continue to evolve at both domestic and international levels.
Unfavorable audit findings or tax rulings could result in payment of additional taxes, fines, and penalties for prior periods and could lead to higher tax rates in future periods. 19 Table of Contents Tax laws and regulations continue to evolve at both domestic and international levels.
Risk Factor Summary ● We are subject to risks related to our dependence on the strength of retail economies. ● Certain products we sell are inherently risky and have given rise to product liability, product warranty claims, and other loss contingencies, including, without limitation, recalls and liability claims relating to Black Diamond Equipment, Ltd.’s (“BDEL”) avalanche beacon transceivers. ● A U.S.
Risk Factor Summary ● We are subject to risks related to our dependence on the strength of retail economies. ● Certain products we sell are used for inherently risky outdoor pursuits and have given rise to product liability or product warranty claims, and other loss contingencies, including, without limitation, recalls and liability claims relating to Black Diamond Equipment, Ltd.’s (“BDEL”) avalanche beacon transceivers. ● A U.S.
If we or our existing third-party cloud-based solution providers experience interruptions in service regularly or for a prolonged basis, or other similar issues, our business could be seriously harmed and, in some instances, our consumers may not be able to purchase our products, which could significantly and negatively affect our sales.
If we or our existing third-party cloud-based solution providers experience interruptions in service for a prolonged basis, our business could be seriously harmed and, in some instances, our consumers may not be able to purchase our products, which could significantly and negatively affect our sales.
If our common stock is thinly traded, the trading of a relatively small volume of our common stock may have a greater impact on the trading price of our common stock than would be the case if our float were larger.
If our common stock is thinly traded, the trading of a relatively small volume of our common 30 Table of Contents stock may have a greater impact on the trading price of our common stock than would be the case if our float were larger.
Approximately 60% of our sales for the year ended December 31, 2024 were earned in international markets. As such our ability to maintain the current level of operations in our existing international markets and to capitalize on growth in existing and new international markets is subject to risks associated with international operations.
Approximately 58% of our sales for the year ended December 31, 2025 were earned in international markets. As such our ability to maintain the current level of operations in our existing international markets and to capitalize on growth in existing and new international markets is subject to risks associated with international operations.
Our ability to meet financial obligations and sustain business operations as well as our growth strategy is contingent upon securing adequate capital and funding. There exists a risk that we may require additional capital in the future, and obtaining such resources may not be achievable on terms deemed acceptable or, in some instances, may not be available at all.
Our ability to meet financial obligations and sustain business operations, including our planned growth initiatives, is contingent upon securing adequate capital and funding. There exists a risk that we may require additional capital in the future, and obtaining such resources may not be achievable on terms deemed acceptable or, in some instances, may not be available at all.
We may require additional capital and funding to meet our financial obligations as well as to support our business operations and growth strategy, and this additional capital and funding may not be available on favorable terms, if at all.
We may require additional capital and funding to meet our financial obligations as well as to support our business operations, including initiatives intended to support our growth, and this additional capital and funding may not be available on favorable terms, if at all.
We have expanded, and are seeking to continue to expand, our business. This growth has placed significant demands on our management, administrative, operating, and financial resources as well as our manufacturing capacity capabilities.
We have expanded our business, including through prior acquisitions, and are seeking to continue to expand through our growth initiatives. This growth has placed significant demands on our management, administrative, operating, and financial resources as well as our manufacturing capacity capabilities.
Our ability to implement our acquisition strategy is also subject to other risks and costs, including: ● loss of key employees, customers or suppliers of acquired businesses; ● diversion of management’s time and attention from our core businesses; ● adverse effects on existing business relationships with suppliers and customers; ● our ability to secure necessary financing; ● our ability to realize operating efficiencies, synergies, or other benefits expected from an acquisition; ● risks associated with entering markets in which we have limited or no experience; ● risks associated with our ability to execute successful due diligence; ● any material differences in the actual financial results of the Company’s past and future acquisitions as compared with our financial expectations for such acquisitions may require us to recognize impairment or other charges, and ● assumption of contingent or undisclosed liabilities of acquisition targets.
Our ability to successfully integrate and operate these businesses is subject to risks and costs, including: ● loss of key employees, customers or suppliers of businesses we have acquired; ● diversion of management’s time and attention from our core businesses; ● adverse effects on existing business relationships with suppliers and customers; ● our ability to realize operating efficiencies, synergies, or other benefits expected from an acquisition; ● risks associated with entering markets in which we have limited or no experience; ● any material differences in the actual financial results of the Company’s past and future acquisitions as compared with our financial expectations for such acquisitions may require us to recognize impairment or other charges, and ● assumption of contingent or undisclosed liabilities of acquisition targets.
This includes, without limitation, the imposition by the CPSC of substantial civil monetary penalties on us and/or the ongoing investigation by the U.S. Department of Justice relating to BDEL’s avalanche beacon transceivers.
This includes, without limitation, the imposition by the CPSC of substantial civil monetary penalties on us, requirements to take corrective actions (including recalls), and/or the ongoing investigation by the U.S. Department of Justice relating to BDEL’s avalanche beacon transceivers.
As a result, our Board of Directors and executive officer, to the extent they vote their shares in a similar manner, have influence over our affairs and could exercise such influence in a manner that is not in the best interests of our other stockholders, including by attempting to delay, defer or prevent a change of control transaction that might otherwise be in the best interests of our stockholders. 26 Table of Contents We may be unable to realize the benefits of our net operating losses and tax credit carryforwards.
As a result, our Board of Directors and executive officer, to the extent they vote their shares in a similar manner, have influence over our affairs and could exercise such influence in a manner 26 Table of Contents that is not in the best interests of our other stockholders, including by attempting to delay, defer or prevent a change of control transaction that might otherwise be in the best interests of our stockholders.
For example, during the year ended December 31, 2024, we recorded approximately $45 million of impairment of goodwill and indefinite-lived intangible assets, specifically the Rhino-Rack and MAXTRAX trademarks, in our Adventure reporting unit.
For example, during the year ended December 31, 2025, we recorded approximately $30 million of impairment of indefinite-lived intangible assets and goodwill, specifically the Rhino-Rack and MAXTRAX trademarks, in our 28 Table of Contents Adventure reporting unit.
However, our ability to use these tax benefits in future years will depend upon the amount of our otherwise taxable income. If we do not have sufficient taxable income in future years to use the tax benefits before they expire, we will lose the benefit of these NOL carryforwards permanently.
If we do not have sufficient taxable income in future years to use the tax benefits before they expire, we will lose the benefit of these NOL carryforwards permanently.
Future events, such as changes in existing laws or policies or their enforcement, or the discovery of currently unknown contamination, may give rise to additional remediation liabilities that may have a material adverse effect upon our business, results of operations or financial condition. Risks Related to our Business There are significant risks associated with acquiring and integrating businesses.
Future events, such as changes in existing laws or policies or their enforcement, or the discovery of currently unknown contamination, may give rise to additional remediation liabilities that may have a material adverse effect upon our business, results of operations or financial condition.
Our reputation and ability to attract, retain and serve consumers is dependent upon the reliable performance of our underlying technology infrastructure and external service providers, including third-party cloud-based solutions. These systems are vulnerable to damage or 25 Table of Contents interruption and we have experienced interruptions in the past.
Our reputation and ability to attract, retain and serve consumers is dependent upon the reliable performance of our underlying technology infrastructure and external service providers, including third-party cloud-based solutions. These systems are vulnerable to damage or interruption and we have experienced interruptions in the past. We rely on cloud-based solutions furnished by third parties to support key business functions.
The members of our Board of Directors and our executive officers, which includes Mr. Warren B. Kanders, beneficially own approximately 22.2% of our outstanding common stock as of March 6, 2025.
The members of our Board of Directors and our executive officers, which includes Mr. Warren B. Kanders, beneficially own approximately 23.5% of our outstanding common stock as of March 5, 2026.
As a result, our efforts to comply with evolving laws, regulations, and standards have resulted in, and are likely to continue to result in, increased general and administrative expenses and a diversion of management time and attention from revenue-generating activities to compliance activities.
As a result, our efforts to comply with evolving laws, regulations, and standards have resulted in, and are likely to continue to result in, increased general and administrative expenses and a diversion of management time and attention from revenue-generating activities to compliance activities. We could face particular challenges in maintaining our internal control over financial reporting.
Our payment of future quarterly dividends on our common stock is subject to the discretion and approval of our Board of Directors. On August 6, 2018, the Company announced that its Board of Directors approved the initiation of the Quarterly Cash Dividend program of $0.025 per share of the Company’s common stock or $0.10 per share on an annualized basis.
On August 6, 2018, the Company announced that its Board of Directors approved the initiation of the Quarterly Cash Dividend program of $0.025 per share of the Company’s common stock or $0.10 per share on an annualized basis.
Even though these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about us or our common stock. 28 Table of Contents Risks Related to our Common Stock Our Amended and Restated Certificate of Incorporation authorizes the issuance of shares of preferred stock.
Even though these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about us or our common stock.
If we identify any material weaknesses or significant deficiencies in our internal control over financial reporting, we may need to take costly steps to implement improved controls and may be subject to sanctions for failure to comply with the requirements of the Sarbanes-Oxley Act.
The development of the internal controls of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such acquisition. 24 Table of Contents If we identify any material weaknesses or significant deficiencies in our internal control over financial reporting, we may need to take costly steps to implement improved controls and may be subject to sanctions for failure to comply with the requirements of the Sarbanes-Oxley Act.
Additionally, our existing cloud-based solution providers have broad discretion to change and interpret their terms of service and other policies with respect to us, and they may take actions beyond our control that could harm our business. We also may not be able to control the quality of the systems and services we receive from our third-party cloud-based solution providers.
Additionally, our existing cloud-based solution providers have broad discretion to change and interpret their terms of service and other policies with respect to us, and they may take actions beyond our control that could harm our business.
The sale of a substantial amount of our common stock in the public market could adversely affect the prevailing market price of our common stock. We have outstanding an aggregate of 38,362,162 shares of our common stock as of March 3, 2025. This includes 7,073,821 shares of common stock that are beneficially owned by Mr.
The sale of a substantial amount of our common stock in the public market could adversely affect the prevailing market price of our common stock. We have outstanding an aggregate of 38,401,824 shares of our common stock as of March 2, 2026. This includes 8,124,220 shares of common stock that are beneficially owned by Mr.
To compete effectively in the future in the consumer products industry, among other things, we must: maintain strict quality standards; develop new and innovative products that appeal to consumers; deliver products on a reliable basis at competitive prices; anticipate and respond to changing consumer trends in a timely manner; maintain favorable brand recognition; and provide effective marketing support.
To compete effectively in the future in the consumer products industry, among other things, we must: maintain strict quality standards; develop new and innovative products that appeal to consumers; deliver products on a reliable basis at competitive prices; anticipate and respond to changing consumer trends in a timely manner; maintain favorable brand recognition; and provide effective marketing support. 16 Table of Contents Our inability to do any of these things could have a material adverse effect on our business, results of operations and financial condition.
Consumer Products Safety Commission’s (the “CPSC”) investigation under the Consumer Product Safety Act in connection with certain models of our avalanche transceivers has resulted in the CPSC’s staff to recommend that the CPSC impose substantial civil monetary penalties on us as well as the U.S.
Consumer Products Safety Commission (“CPSC”) investigation under the Consumer Product Safety Act in connection with certain models of our avalanche transceivers has resulted in the CPSC’s staff recommending that the CPSC seek substantial civil monetary penalties from us, and has led the U.S.
The success of our proprietary products depends, in part, on our ability to protect our current and future technologies and products and to defend our intellectual property rights. If we fail to adequately protect our intellectual property rights, competitors may manufacture and market products similar to ours. Our principal intellectual property rights include our trademarks, patents, and trade secrets.
If we fail to adequately protect our intellectual property rights, competitors may manufacture and market products similar to ours, which could adversely affect our market share and results of operations. The success of our proprietary products depends, in part, on our ability to protect our current and future technologies and products and to defend our intellectual property rights.
If some or our entire workforce were to become unionized and collective bargaining agreement terms were significantly different from our current compensation arrangements or work practice, it could have a material adverse effect on our business, financial condition and results of operations. We may not be able to adequately manage our growth.
If some or our entire workforce were to become unionized and collective bargaining agreement terms were significantly different from our current compensation arrangements or work practice, it could have a material adverse effect on our business, financial condition and results of operations. Reductions in the availability of energy supplies or an increase in energy costs may increase our operating costs.
Also, we have reporting obligations to safety regulators in all jurisdictions where we sell our products, where reporting may trigger further regulatory investigations. We could face particular challenges in maintaining our internal control over financial reporting.
Also, we have reporting obligations to safety regulators in all jurisdictions where we sell our products, where reporting may trigger further regulatory investigations.
Our ability to meet consumer expectations, manage inventory, complete sales, and achieve our objectives for operating efficiencies depends on the proper operation of our existing distribution facilities, as well as the facilities of third-parties, the development or expansion of additional distribution capabilities and services, and the timely performance of services by third-parties, including those involved in moving products to and from our distribution facilities and facilities operated by third-parties. 17 Table of Contents Our operations in international markets, and earnings in those markets, may be affected by changes in global cultural, political, and financial market conditions as well as potential changes in regulations, legislation and government policies such as tariffs, tax laws and global trade policies.
Our ability to meet consumer expectations, manage inventory, complete sales, and achieve our objectives for operating efficiencies depends on the proper operation of our existing distribution facilities, as well as the facilities of third-parties, the development or expansion of additional distribution capabilities and services, and the timely performance of services by third-parties, including those involved in moving products to and from our distribution facilities and facilities operated by third-parties. 17 Table of Contents Our international operations expose us to changing global conditions and legal and regulatory requirements, including tariffs, trade restrictions, and anti-corruption and sanctions laws such as the FCPA.
We maintain and rely extensively on information technology systems and network infrastructures for the effective operation of our business. Techniques used to gain unauthorized access to private networks are constantly evolving, and we may be unable to anticipate or prevent unauthorized access to data pertaining to our customers, including credit card and debit card information and other personally identifiable information.
We maintain and rely extensively on information technology systems and network infrastructures for the effective operation of our business, including manufacturing, order fulfillment, financial reporting, and communications with customers and suppliers. Techniques used to gain unauthorized access to networks, compromise systems, or obtain data are constantly evolving, and we may be unable to anticipate or prevent all incidents.
In connection with our general growth strategy of acquiring businesses and assets, we have and may be forced in the future to write-down or write-off assets, restructure our operations, or incur impairment or other charges that could result in us reporting losses.
In connection with businesses and assets we have previously acquired with respect to our Adventure segment, we have and may be forced in the future to write-down or write-off assets, restructure our operations, or incur impairment, or other charges, and we may incur similar charges in the future, including with respect to intangible assets or other assets associated with those past acquisitions, that could result in us reporting losses.
We may also experience difficulties in implementing or operating our new or upgraded business processes or information technology systems, including, but not limited to, ineffective or inefficient operations, significant system failures, system outages, delayed implementation and loss of system availability, which could lead to increased implementation and/or operational costs, loss or corruption of data, delayed shipments, excess inventory and interruptions of operations resulting in lost sales and/or profits.
We may also experience difficulties in implementing or operating our new or upgraded business processes or information technology systems, including, but not limited to, ineffective or inefficient operations, significant system failures, system outages, delayed implementation and loss of system availability, which could lead to increased implementation and/or operational costs, loss or corruption of data, delayed shipments, excess inventory and interruptions of operations resulting in lost sales and/or profits. 25 Table of Contents We rely on information technology systems, including third-party cloud-based solutions, and any failure of these systems, including, without limitation, due to outages and/or cyberattacks, may result in disruptions or outages, loss of processing capabilities, and/or loss of data, any of which may have a material adverse effect on our business, operations, and financial results.
In addition, acquisition targets may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of their internal controls. The development of the internal controls of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such acquisition.
In addition, acquisition targets may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of their internal controls.
In addition, it may be more difficult for us to enforce agreements, collect receivables, receive dividends and repatriate earnings through foreign legal systems.
In addition, it may be more difficult for us to enforce agreements, collect receivables, receive dividends and repatriate earnings through foreign legal systems. In addition, our international operations may increase our exposure to compliance risks under anti-corruption, anti-money laundering, and sanctions laws.
In addition, the impact of pandemics, such as the COVID-19 pandemic, may also exacerbate other risks discussed in this Item 1A, any of which could have a material effect on us. 20 Table of Contents We use foreign suppliers and manufacturing facilities for a significant portion of our raw materials and finished products, and disruptions to international trade, such as disease epidemics or potential “trade wars,” pose a risk to our business operations. ​ A majority of our products sold were produced by and purchased from independent manufacturers primarily located in Asia and Eastern Europe, with substantially all of the remainder produced by our manufacturing facilities located in Utah.
We use foreign suppliers and manufacturing facilities for a significant portion of our raw materials and finished products, and disruptions to international trade, such as disease epidemics or potential “trade wars,” pose a risk to our business operations. ​ The vast majority of our products sold were produced by and purchased from independent manufacturers primarily located in Asia and Eastern Europe.
The effects of climate change and increased focus by governmental and non-governmental organizations, customers, consumers and investors on sustainability issues, including those related to climate change and socially responsible activities, may adversely affect our business and financial results and damage our reputation.
The effects of climate change, together with increased focus by governmental and non-governmental organizations, customers and investors on sustainability issues, including evolving climate and sustainability related disclosure expectations, may adversely affect our business and financial results and damage our reputation. Climate change is occurring around the world and may impact our business in numerous ways.
Some of our operations are conducted or products are sold in countries where economic growth has slowed, or where economies have suffered economic, social and/or political instability or hyperinflation. Moreover, declining economic conditions create the potential for future impairments of goodwill and other intangible and long-lived assets that may negatively impact our financial condition and results of operations.
Moreover, declining economic conditions create the potential for future impairments of goodwill and other intangible and long-lived assets that may negatively impact our financial condition and results of operations.
Net operating losses (“NOLs”) may be carried forward to offset federal and state taxable income in future years and eliminate income taxes otherwise payable on such taxable income, subject to certain adjustments. Based on current federal corporate income tax rates, our NOL and other carryforwards could provide a benefit to us, if fully utilized, of significant future tax savings.
We may be unable to realize the benefits of our net operating losses and tax credit carryforwards. Net operating losses (“NOLs”) may be carried forward to offset federal and state taxable income in future years and eliminate income taxes otherwise payable on such taxable income, subject to certain adjustments.
We hold numerous patents for the invention of new or improved technologies, which are known as utility patents, and pending patent applications covering a wide variety of products.
If we fail to adequately protect our intellectual property rights, competitors may manufacture and market products similar to ours. Our principal intellectual property rights include our trademarks, patents, and trade secrets. We hold numerous patents for the invention of new or improved technologies, which are known as utility patents, and pending patent applications covering a wide variety of products.
The issuance of a large number of shares of common stock in connection with an acquisition could also have a negative effect on our ability to use our NOLs. 29 Table of Contents If securities or industry analysts do not publish or cease publishing research or reports about us, our business, or our market, or if they change their recommendations regarding our securities adversely, the price and trading volume of our securities could decline.
If securities or industry analysts do not publish or cease publishing research or reports about us, our business, or our market, or if they change their recommendations regarding our securities adversely, the price and trading volume of our securities could decline.
Any transition of the cloud-based solutions currently provided to different cloud providers would be difficult to implement and may cause us to incur significant time and expense. If we and/or our cloud-based solution providers are not successful in preventing or effectively responding to outages and cyberattacks, our business, operations, and financial results could be materially and adversely affected.
If we and/or our cloud-based solution providers are not successful in preventing or effectively responding to outages or other disruptions, our business, operations, and financial results could be materially and adversely affected.
We cannot predict whether there might be changes in our ability to repatriate earnings or capital from international jurisdictions. Changes in regulatory and geopolitical policies and other factors may adversely affect our business or may require us to modify our current business practices.
We cannot predict whether there might be changes in our ability to repatriate earnings or capital from international jurisdictions.
Such shares of preferred stock could have preferences over our common stock with respect to dividends and liquidation rights. We may issue additional preferred stock in ways which may delay, defer or prevent a change in control of the Company without further action by our stockholders.
Any such preferred stock could have preferences over our common stock with respect to dividends and liquidation rights and could be used to delay, defer or prevent a change in control of the Company, including by adversely affecting the voting power of holders of our common stock through the creation of class or series voting rights.
Kanders, our Chairman of the Board. The sale of a significant amount of shares at any given time, or the perception that such sales could occur, including sales of the shares beneficially owned by Mr. Kanders, could adversely affect the prevailing market price of our common stock.
Kanders, our Chairman of the Board. Sales of a substantial number of shares of our common stock in the public market, or the perception that these sales might occur, including sales of the shares beneficially owned by Mr.
We may issue common stock in the future for other purposes as well, including in connection with financings, for compensation purposes, in connection with strategic transactions or for other purposes.
We may issue common stock in the future for other purposes as well, including in connection with financings, for compensation purposes, in connection with strategic transactions or for other purposes. The issuance of a large number of shares of common stock in connection with an acquisition could also have a negative effect on our ability to use our NOLs.
Any increase in the cost of our labor could have an adverse effect on our operating costs, financial condition and results of operations, which in turn can materially adversely affect our business.
Any increase in the cost of our labor could have an adverse effect on our operating costs, financial condition and results of operations, which in turn can materially adversely affect our business. 23 Table of Contents Although none of our employees are currently covered under collective bargaining agreements, we cannot guarantee that employees will not elect to be represented by labor unions in the future.
If the reputation, culture or image of any of our brands and products, including, without limitation, recalls and liability claims relating to BDEL’s avalanche beacon transceivers, is tarnished or if we receive negative publicity, then our sales, financial condition and results of operations could be materially and adversely affected. 13 Table of Contents From time to time, we have been and may be subject to legal proceedings, regulatory investigations or disputes, and governmental inquiries that could cause us to incur significant expenses, divert our management’s attention, damage our business and reputation as well as have a material adverse effect on the Company’s liquidity, stock price, consolidated financial position, results of operations and/or cash flows.
If the reputation, culture or image of any of our brands and products, including, without limitation, recalls and liability claims relating to BDEL’s avalanche beacon transceivers, is tarnished or if we receive negative publicity, then our sales, financial condition and results of operations could be materially and adversely affected.
In addition, our growth strategy may create perceived uncertainties as to our future direction and may result in the loss of employees, customers or business partners. 22 Table of Contents Turmoil across various sectors of the financial markets may negatively impact the Company’s business, financial condition, and/or operating results as well as our ability to effectively execute our growth strategy.
Any of these outcomes could materially and adversely affect our business, results of operations, cash flows, and financial condition. Turmoil across various sectors of the financial markets may negatively impact the Company’s business, financial condition, and/or operating results as well as our ability to effectively execute our growth initiatives.
As new regulations and interpretations emerge, our ability to mitigate risks associated with these changes may be limited, and our results of operations and financial condition could be adversely affected. 19 Table of Contents Ongoing conflicts in multiple locations across the globe, as well as economic sanctions and other measures imposed in response thereto could have a material adverse effect on our operations, results of operations, financial condition, liquidity and business outlook.
As new regulations and interpretations emerge, our ability to mitigate risks associated with these changes may be limited, and our results of operations and financial condition could be adversely affected.
Our Amended and Restated Certificate of Incorporation provides that our Board of Directors will be authorized to issue from time to time, without further stockholder approval, up to 5,000,000 shares of preferred stock in one or more series and to fix or alter the designations, preferences, rights and any qualifications, limitations or restrictions of the shares of each series, including the dividend rights, dividend rates, conversion rights, voting rights, terms of redemption, including sinking fund provisions, redemption price or prices, liquidation preferences and the number of shares constituting any series or designations of any series.
For example, our amended and restated certificate of incorporation authorizes our board of directors to issue up to 5,000,000 shares of “blank check” preferred stock in one or more series, without further stockholder approval, and to determine the rights, preferences and limitations of any such series.
Russia’s potential response to such sanctions, as well as prolonged unrest, intensified military activities and/or the implementation of more extensive sanctions impacting the region could have a material adverse effect on our operations, results of operations, financial condition, liquidity and business outlook.
The uncertain consequences and duration of these conflicts, and the risk that they may expand in scope, escalate, or result in broader regional or global instability, including through the emergence of additional conflicts or heightened tensions in other regions, including the potential effects of any sanctions and countersanctions against officials, individuals and industries relating to these regions, including Russia, and the potential response to any such sanctions, as well as prolonged unrest and/or intensified military activities impacting these regions could have a material adverse effect on our operations, results of operations, financial condition, liquidity and business outlook.
Also, we have reporting obligations to safety regulators in all jurisdictions where we sell our products, where reporting may trigger further regulatory investigations. We are subject to risks related to our dependence on the strength of retail economies in various parts of the world, and our performance may be affected by general economic conditions.
Any amounts advanced are generally subject to an undertaking to repay such amounts if it is ultimately determined that the applicable person was not entitled to indemnification. We are subject to risks related to our dependence on the strength of retail economies in various parts of the world, and our performance may be affected by general economic conditions.
We have also designed a significant portion of our software and computer systems to utilize data processing and storage capabilities from third-party cloud solution providers. Both our on-premises and cloud-based infrastructure may be susceptible to outages due to any number of reasons, including, human error, fire, floods, power loss, telecommunications failures, terrorist attacks and similar events.
Both our on-premises and cloud-based infrastructure may be susceptible to outages due to any number of reasons, including, human error, natural disasters, power loss, telecommunications failures, cyber incidents, or other events. We do not have redundancy for all of our systems and our disaster recovery planning may not account for all eventualities.
Our direct-to-consumer service, which is supported by our own systems and those of third-party vendors, is vulnerable to computer viruses, Internet worms, break-ins, phishing attacks, attempts to overload servers with denial-of-service or other attacks and similar disruptions from unauthorized use of our and third-party vendor computer systems, any of which could lead to system interruptions, delays or shutdowns, causing loss of critical data or the unauthorized access to personally identifiable information.
We and our third-party vendors are vulnerable to computer viruses, malware, ransomware, phishing and other social engineering attacks, denial-of-service attacks, insider threats, and other malicious activities. Any such incident could lead to interruptions, delays, or shutdowns; loss, corruption, or unauthorized access to data (including personally identifiable information); and increased costs and diversion of management attention.
Removed
As such, the concentration of our capital stock ownership with insiders will likely limit your ability to influence corporate matters. ● The ability of our information technology systems or information security systems to operate effectively, including as a result of cybersecurity incidents, viruses, hackers, malware, natural disasters, vendor business interruptions or other causes. ● The impact of changes in tariffs, tax laws, global trade policies as well as instability and volatility in global markets.
Added
Insurance coverage may become unavailable or more expensive, and policy limits, exclusions, or retentions could leave us exposed to significant uninsured or underinsured losses.
Removed
Risks Related to Our Industry Many of the products we sell are used for inherently risky outdoor pursuits and have given rise to product liability or product warranty claims and other loss contingencies including, without limitation, recalls and liability claims relating to BDEL’s avalanche beacon transceivers, which could affect our earnings and financial condition.
Added
Under the Company’s Second Amended and Restated By-Laws, the Company may be obligated to indemnify, and advance expenses (including reasonable attorneys’ fees) to, certain officers and employees of the Company or its subsidiaries in connection with the investigation being conducted by the United States Department of Justice relating to the Company’s avalanche transceivers and any related proceedings, including if such persons are or become witnesses, subjects, targets, or otherwise become involved in such matters.
Removed
Our inability to do any of these things could have a material adverse effect on our business, results of operations and financial condition. 16 Table of Contents If we fail to adequately protect our intellectual property rights, competitors may manufacture and market products similar to ours, which could adversely affect our market share and results of operations.
Added
If any applicable liability insurance maintained by the Company is unavailable or is not sufficient to cover, or does not cover, such indemnification and advancement obligations and related costs, the Company may be required to pay such amounts directly, which could be significant and could adversely affect the Company’s liquidity, consolidated financial position, results of operations and/or cash flows.
Removed
Ongoing wars in multiple locations across the globe, as well as economic sanctions and other measures imposed in response thereto, have caused and continue to cause disruption, instability and volatility in global markets.
Added
In addition, our direct-to-consumer and wholesale sales could be adversely affected by changes in the terms, fees, algorithms, search placement, advertising policies, data access, or other practices of third-party e-commerce platforms, online marketplaces, and digital marketing channels, as well as by disruptions or outages affecting such platforms.
Removed
The conflicts have caused and may continue to cause adverse global economic conditions resulting from escalating geopolitical tensions, the exclusion of certain financial institutions from the global banking system, volatility and fluctuations in foreign currency exchange rates and interest rates, inflationary pressures, supply chain and logistics disruptions, such as shipping disruptions in waterways, and heightened cybersecurity threats.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAs part of our overall risk management and assessment program, we design, implement, and maintain reasonable safeguards to minimize potential risks, including cybersecurity risks; reasonably address any identified gaps in existing safeguards; update existing safeguards as necessary; and monitor the effectiveness of our safeguards.
Biggest changeAs part of our overall risk management and assessment program, we design, implement, and maintain reasonable safeguards to minimize potential risks, including cybersecurity risks; reasonably address any identified gaps in existing safeguards; update existing safeguards as necessary; and monitor the effectiveness of our safeguards which may include, as appropriate: (i) vulnerability management (including patching, configuration management, and remediation tracking); (ii) security monitoring and detection designed to identify anomalous activity; (iii) access controls and identity management practices intended to support least-privilege access; (iv) data protection practices (including, where appropriate, encryption and backup processes); (v) incident response planning and readiness activities, including tabletop exercises and lessons-learned reviews; and (vi) business continuity and disaster recovery planning for certain systems and processes.
These risk assessments include identifying reasonably foreseeable potential internal and external risks, the likelihood of occurrence and any potential damage that could result from such risks, and the sufficiency of existing policies, procedures, systems, controls, and other safeguards in place to manage such risks.
These risk assessments include identifying reasonably foreseeable potential internal and external risks, the likelihood of occurrence and any potential damage that could result from such risks, and the sufficiency of existing policies, procedures, 32 Table of Contents systems, controls, and other safeguards in place to manage such risks.
Our management team is informed about and monitors the prevention, detection, mitigation, and remediation of cybersecurity risks and incidents through various means, which may include, among other things, briefings with internal security personnel, threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us, and alerts and reports produced by security tools deployed in our IT environment. 31 Table of Contents
Our management team is informed about and monitors the prevention, detection, mitigation, and remediation of cybersecurity risks and incidents through various means, which may include, among other things, briefings with internal security personnel, threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us, and alerts and reports produced by security tools deployed in our IT environment, as well as input from external consultants engaged by us.
We routinely assess material risks from cybersecurity threats, including any potential unauthorized occurrence on or conducted through our information systems that may result in adverse effects on the confidentiality, integrity, or availability of our information systems or any information residing therein.
We routinely assess cybersecurity threats, including any potential unauthorized occurrence on or conducted through our information systems that may result in adverse effects on the confidentiality, integrity, or availability of our information systems or any information residing therein and the data we process, store, or transmit.
ITEM 1C. CYBERSECURITY Risk Management and Strategy We have established policies and processes for assessing, identifying, and managing material risk from cybersecurity threats, and have integrated these processes into our overall risk management systems and processes.
ITEM 1C. CYBERSECURITY Risk Management and Strategy We have established policies and processes for assessing, identifying, and managing cybersecurity risks, including risks from cybersecurity threats that could be material to the Company and have integrated these processes into our overall risk management systems and processes.
Our cybersecurity team, consisting of the VP of Information Technology, Director of Information Security, and Director of Infrastructure, is principally responsible for managing our cybersecurity risk assessment processes, our security controls, mitigation process and our response to cybersecurity threats. The Company also participates in a cybersecurity risk insurance policy.
Our cybersecurity team, consisting of the VP of Information Technology, Director of Governance, Compliance and Risk, and our Director of Information Security and Infrastructure, is principally responsible for managing our cybersecurity risk assessment processes, our security controls, mitigation process and our response to cybersecurity threats.
We conduct annual risk assessments to identify cybersecurity threats to our critical systems, information, services, and our broader enterprise IT environment.
While we use these frameworks to help evaluate and enhance our controls and processes, we do not represent that our program fully satisfies any particular technical standard, specification, or requirement. We conduct annual risk assessments to identify cybersecurity threats to our critical systems, information, services, and our broader enterprise IT environment.
Added
We evaluate our resourcing and investments in cybersecurity on an ongoing basis in light of our risk profile, business needs, and the evolving threat landscape.
Added
The Company also participates in a cybersecurity risk insurance policy, intended to help mitigate certain losses and expenses associated with cybersecurity incidents; however, such insurance may not cover all losses or all types of claims.
Added
Material cybersecurity matters are escalated to the Board and/or the Audit Committee based on their nature, scope, and potential impact.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeDistribution and Manufacturing Facility: ​ Salt Lake City, Utah ​ Leased ​ ​ ​ ​ ​ Black Diamond European Sales and Marketing Office: ​ Innsbruck, Austria ​ Leased ​ ​ ​ ​ ​ PIEPS Sales and Marketing Office: ​ Lebring, Austria ​ Leased ​ ​ ​ ​ ​ Black Diamond HQ Retail Store ​ Salt Lake City, Utah ​ Owned ​ ​ ​ ​ ​ Black Diamond Trolley Square Retail Store ​ Salt Lake City, Utah ​ Leased ​ ​ ​ ​ ​ Black Diamond Jackson Retail Store ​ Jackson, Wyoming ​ Leased ​ ​ ​ ​ ​ Black Diamond Boulder Retail Store ​ Boulder, Colorado ​ Leased ​ ​ ​ ​ ​ Black Diamond Seattle Retail Store ​ Seattle, Washington ​ Leased ​ ​ ​ ​ ​ Adventure Segment ​ ​ ​ ​ ​ ​ ​ ​ ​ Rhino-Rack Australia Headquarters: ​ Sydney, Australia ​ Leased ​ ​ ​ ​ ​ Rhino-Rack Australia Perth Distribution Facility: ​ Perth, Australia ​ Leased ​ ​ ​ ​ ​ Rhino-Rack U.S.
Biggest changeHeadquarters and Distribution Facility ​ Salt Lake City, Utah ​ Leased ​ ​ ​ ​ ​ Black Diamond European Sales and Marketing Office ​ Innsbruck, Austria ​ Leased ​ ​ ​ ​ ​ Black Diamond HQ Retail Store ​ Salt Lake City, Utah ​ Owned ​ ​ ​ ​ ​ Black Diamond Jackson Retail Store ​ Jackson, Wyoming ​ Leased ​ ​ ​ ​ ​ Black Diamond Boulder Retail Store ​ Boulder, Colorado ​ Leased ​ ​ ​ ​ ​ Black Diamond Seattle Retail Store ​ Seattle, Washington ​ Leased ​ ​ ​ ​ ​ Adventure Segment ​ ​ ​ ​ ​ ​ ​ ​ ​ Rhino-Rack Australia Headquarters and Distribution Facility ​ Sydney, Australia ​ Leased ​ ​ ​ ​ ​ Rhino-Rack Australia Perth Distribution Facility ​ Perth, Australia ​ Leased ​ ​ ​ ​ ​ Rhino-Rack U.S.
ITEM 2. PROPERTIES Our corporate headquarters, as well as our primary research, evaluation and design studios, is located in a facility owned by the Company in Salt Lake City, Utah. In addition, as of December 31, 2024, the Company and its subsidiaries lease or own facilities throughout the U.S., Europe, Australia and New Zealand.
ITEM 2. PROPERTIES Our corporate headquarters, as well as our primary research, evaluation and design studios, is located in a facility owned by the Company in Salt Lake City, Utah. In addition, as of December 31, 2025, the Company and its subsidiaries lease or own facilities throughout the U.S., Europe, and Australia.
The following table identifies and provides certain information regarding our principal facilities: ​ ​ ​ ​ ​ Activity ​ Location ​ Owned/Leased ​ ​ ​ ​ ​ Corporate Headquarters: ​ Salt Lake City, Utah ​ Owned ​ ​ ​ ​ ​ Outdoor Segment ​ ​ ​ ​ ​ ​ ​ ​ ​ Black Diamond U.S.
In general, our properties are well maintained, considered adequate and being utilized for their intended purposes. 33 Table of Contents The following table identifies and provides certain information regarding our principal facilities: ​ ​ ​ ​ ​ Activity ​ Location ​ Owned/Leased ​ ​ ​ ​ ​ Corporate Headquarters ​ Salt Lake City, Utah ​ Owned ​ ​ ​ ​ ​ Outdoor Segment ​ ​ ​ ​ ​ ​ ​ ​ ​ Black Diamond U.S.
Distribution Facility: ​ Denver, Colorado ​ Leased ​ ​ ​ ​ ​ Rhino-Rack N.Z. Distribution Facility: ​ Wellington, New Zealand ​ Leased ​ ​ ​ ​ ​ MAXTRAX and TRED Australia Headquarters: ​ Brisbane, Australia ​ Leased ​ ​ ​ ​ 32 Table of Contents
Distribution Facility ​ Denver, Colorado ​ Leased ​ ​ ​ ​ ​ MAXTRAX and TRED Australia Headquarters ​ Brisbane, Australia ​ Leased ​ ​ ​ ​
Removed
In general, our properties are well maintained, considered adequate and being utilized for their intended purposes.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeWalbrecht’s independent counsel responded to the CPSC, denying the allegations of its June 25 letter and rejecting its demand for a penalty. On January 23, 2025, the Company and BDEL were each served with grand jury subpoenas from the U.S. Attorney’s Office for the District of Utah requiring the production of documents relating to avalanche transmitters distributed by BDEL.
Biggest changeOn January 23, 2025, in connection with a criminal investigation, the Company and BDEL were each served with grand jury subpoenas from the United States Department of Justice requiring the production of documents relating to avalanche transmitters distributed by BDEL. The Company and BDEL are cooperating with the investigation and have produced all relevant documents.
On September 6, 2023, the CPSC requested further clarification and information regarding the reed switch issue, to which BDEL responded on October 6 and 13, 2023.
On September 6, 2023, the CPSC requested further clarification and information regarding the reed switch issue, to which BDEL responded on October 6, 2023 and October 13, 2023.
There is a reasonable possibility of loss from contingencies in excess of the amounts accrued by the Company in the accompanying consolidated balance sheets; however, the actual amounts of such possible losses cannot currently be reasonably estimated by the Company at this time.
There 34 Table of Contents is a reasonable possibility of loss from contingencies in excess of the amounts accrued by the Company in the accompanying consolidated balance sheets; however, the actual amounts of such possible losses cannot currently be reasonably estimated by the Company at this time.
The CPSC approved the recall and entered into a 33 Table of Contents Corrective Action Plan agreement with BDEL in August 2022.
The CPSC approved the recall and entered into a Corrective Action Plan agreement with BDEL in August 2022.
Department of Justice for further proceedings. The Company and BDEL intend to strongly contest and vigorously defend against any claims which may be asserted against them. John C.
The Company and BDEL intend to strongly contest and vigorously defend against any claims which may be asserted against them by the Department of Justice or the CPSC. John C.
(“BDEL”) wrote to the U.S. Consumer Product Safety Commission (“CPSC”) outlining its new cradle solution for certain models of its avalanche beacon transceivers to prevent such transceivers from switching unexpectedly out of “send” mode.
(“BDEL”) filed a Section 15(b) report with the U.S. Consumer Product Safety Commission (“CPSC”) outlining its new cradle solution for certain models of its avalanche beacon transceivers to prevent such transceivers from switching unexpectedly out of “send” mode.
On November 20, 2023 and February 8, 2024, respectively, BDEL submitted a comprehensive response disputing the CPSC’s findings and conclusions in the October 12, 2023 and December 18, 2023 letters, including the amount of any potential penalties. The CPSC ultimately disagreed with our position and the agency voted to refer the matter to the U.S.
On November 20, 2023 and February 8, 2024, respectively, BDEL submitted a comprehensive response disputing the CPSC’s findings and conclusions, including the amount of any potential penalties. The CPSC ultimately disagreed with our position and the agency voted to refer the matter to the U.S. Department of Justice for further proceedings.
Walbrecht personally. Pursuant to the Company’s by-laws, the Company has agreed to indemnify Mr. Walbrecht and pay his legal fees, and he has provided an undertaking to the Company that the Company will be entitled to recover those expenses if it is ultimately determined that he was not entitled to indemnification. On August 26, 2024, Mr.
Walbrecht and pay his legal fees in connection with the occurrences described above, and he has provided an undertaking to the Company that the Company will be entitled to recover those expenses if it is ultimately determined that he was not entitled to indemnification. On August 26, 2024, Mr.
Any penalties imposed by the CPSC or other regulators, could be costly to us and could damage our business and reputation as well as have a material adverse effect on the Company’s liquidity, stock price, consolidated financial position, results of operations and/or cash flows. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. ​ 34 Table of Contents PART II
Any penalties imposed by the CPSC or other regulators, could be costly to us and could damage our business and reputation as well as have a material adverse effect on the Company’s liquidity, stock price, consolidated financial position, results of operations and/or cash flows. Clarus Corporation v. HAP Trading, LLC and Harsh A.
The Company and BDEL intend to cooperate with this investigation. Based on currently available information, the Company believes an unfavorable outcome with the CPSC is probable, however, we cannot reasonably estimate on what terms this matter will be resolved.
On January 28, 2026, the CPSC closed its investigation without taking further action. Based on currently available information, the Company believes an unfavorable outcome with the CPSC is probable, however, we cannot reasonably estimate on what terms this matter will be resolved with the CPSC or the U.S. Department of Justice.
Added
Walbrecht 35 Table of Contents personally. Pursuant to the Company’s by-laws, the Company has agreed to indemnify Mr.
Added
Walbrecht’s independent counsel responded to the CPSC, denying the allegations of its June 25, 2024 letter and rejecting its demand for a penalty.
Added
The DOJ has sent letters to Mr. Walbrecht and Rick Vance (BDEL’s former Director of Quality) advising them that they are targets in its investigation of possible criminal conduct. The DOJ has since served two subpoenas upon a current and former employee of BDEL for grand jury testimony.
Added
The Company’s Board of Directors has approved indemnity and payment of legal fees for current and former employees subpoenaed by the DOJ, in the same manner and subject to the same conditions described above for Mr. Walbrecht.
Added
On March 13, 2025, the Company received a letter from the CPSC requesting various categories of documents and information in connection with an investigation into whether BDEL sold products that were subject to a recall. The Company has cooperated with that investigation, substantially completed document production, and delivered a narrative explanatory letter to the CPSC on June 18, 2025.
Added
Padia On September 23, 2022, the Company filed a lawsuit in the United States District Court for the Southern District of New York against HAP Trading, LLC and Harsh A. Padia, seeking disgorgement of profits from transactions in the Company’s common stock and related derivative securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended.
Added
On March 14, 2025, the Court issued an Opinion and Order granting the defendants’ motion for summary judgment on the ground that they qualified for the market making exemption under Section 16(d) of the Exchange Act.
Added
On April 11, 2025, the Company filed a timely Notice of Appeal and the appeal was argued before the United States Court of Appeals for the Second Circuit on February 12, 2026. We are currently waiting for the Appeals Court to opine.
Added
The Court of Appeals has invited the Securities and Exchange Commission (“SEC”) to submit a brief within 60 days or by April 17, 2026, and to advise the Court by March 10, 2026 if it does not intend to submit a brief. If the SEC submits a brief, each side will have 21 days to submit a brief in response.
Added
Williams v. Caption Management, LLC, et al. / Clarus Corporation v. Caption Management, LLC, et al.
Added
On February 12, 2024, a stockholder of the Company filed a lawsuit against Caption Management LLC and related entities (“Caption Management”) in the United States District Court for the Southern District of New York, seeking disgorgement of short-swing profits for violations of Section 16(b) of the Securities Exchange Act of 1934.
Added
The Company is named as a nominal defendant and any recovery in the case will inure to the benefit of the Company. On March 8, 2024, the Company filed its own lawsuit against these same defendants for disgorgement of short-swing profits under Section 16(b) of the Securities Exchange Act of 1934, as amended.
Added
On February 10, 2026, the Court granted the Company’s motion to dismiss the stockholder action without prejudice on the ground that it was duplicative of the Company’s direct action against the same defendants alleging the same Section 16(b) violations. On February 24, 2026, the Company entered into a settlement agreement with Caption Management to resolve the Company’s claims.
Added
Under the terms of the settlement agreement, Caption Management paid the Company an undisclosed sum in exchange for, among other things, 36 Table of Contents mutual releases and dismissal of the claims with prejudice. The settlement resolves the Company’s claims against Caption Management without any admission of liability or wrongdoing by any party. ITEM 4.
Added
MINE SAFETY DISCLOSURES Not applicable. ​ 37 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeSecurities Authorized for Issuance Under Equity Compensation Plans The following table sets forth certain information regarding our equity plans as of December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ Plan Category ​ (A) Number of securities to be issued upon exercise of outstanding, warrants and rights ​ (B) Weighted-average exercise price of outstanding options, warrants and rights ​ (C) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (A)) Equity compensation plans approved by security holders (1) ​ 4,231,747 ​ $ 15.55 ​ 10,186,530 ​ ​ ​ ​ ​ ​ ​ ​ Total ​ 4,231,747 ​ $ 15.55 ​ 10,186,530 ​ (1) Consists of stock options and restricted stock awards issued and issuable under the 2005 Stock Incentive Plan and the 2015 Stock Incentive Plan.
Biggest changeSecurities Authorized for Issuance Under Equity Compensation Plans The following table sets forth certain information regarding our equity plans as of December 31, 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ Plan Category ​ (A) Number of securities to be issued upon exercise of outstanding, warrants and rights ​ (B) Weighted-average exercise price of outstanding options, warrants and rights ​ (C) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (A)) Equity compensation plans approved by security holders (1) ​ 4,616,747 ​ $ 14.23 ​ 7,420,000 ​ ​ ​ ​ ​ ​ ​ ​ Total ​ 4,616,747 ​ $ 14.23 ​ 7,420,000 ​ (1) Consists of stock options and restricted stock awards issued and issuable under the Amended and Restated 2015 Stock Incentive Plan.
The program was replaced with a new stock repurchase program that allows the repurchase of up to $50,000,000 of the Company’s outstanding common stock, which still had $42,829,217 available as of December 31, 2024. No repurchases of shares of the Company’s common stock occurred during the three months ended December 31, 2024.
The program was replaced with a new stock repurchase program that allows the repurchase of up to $50,000,000 of the Company’s outstanding common stock, which still had $42,829,217 available as of December 31, 2025. No repurchases of shares of the Company’s common stock occurred during the three months ended December 31, 2025.
Performance Graph Set forth below is a line graph comparing the yearly percentage change in the cumulative total stockholder return on our common stock to the cumulative total return of the NASDAQ Global Select Market Composite and the Russell 2000 Index for the period commencing on December 31, 2019 and ending on December 31, 2024 (the “Measuring Period”).
Performance Graph Set forth below is a line graph comparing the yearly percentage change in the cumulative total stockholder return on our common stock to the cumulative total return of the NASDAQ Global Select Market Composite and the Russell 2000 Index for the period commencing on December 31, 2020 and ending on December 31, 2025 (the “Measuring Period”).
The graph assumes that the value of the investment in our common stock and the indexes was $100 on December 31, 2019.
The graph assumes that the value of the investment in our common stock and the indexes was $100 on December 31, 2020.
As of March 3, 2025, there were 63 holders of record of our common stock. 35 Table of Contents Dividends On August 6, 2018, the Company announced that its Board of Directors approved the initiation of a Quarterly Cash Dividend program of $0.025 per share of the Company’s common stock or $0.10 per share on an annualized basis.
As of March 2, 2026, there were 62 holders of record of our common stock. 38 Table of Contents Dividends On August 6, 2018, the Company announced that its Board of Directors approved the initiation of a Quarterly Cash Dividend program of $0.025 per share of the Company’s common stock or $0.10 per share on an annualized basis.
There are a total of 1,100,000 restricted stock awards included in column (A) that do not have an exercise price. Excluding these restricted stock awards, the weighted average exercise price of outstanding options, warrants and rights is $10.18. ​ ITEM 6. [RESERVED] ​ 36 Table of Contents
There are a total of 1,050,000 restricted stock awards included in column (A) that do not have an exercise price. Excluding these restricted stock awards, the weighted average exercise price of outstanding options, warrants and rights is $9.01. ​ ITEM 6. [RESERVED] ​ 39 Table of Contents
In 2024, 2023 and 2022, our total Quarterly Cash Dividends were $3,831,000, $3,750,000, and $3,721,000 respectively.
In 2025, 2024 and 2023, our total Quarterly Cash Dividends were $3,840,000, $3,831,000, and $3,750,000 respectively.
On March 5, 2025, the Company announced that its Board of Directors approved the payment on March 26, 2025 of the Quarterly Cash Dividend to the record holders of shares of the Company’s common stock as of the close of business on March 17, 2025.
On March 4, 2026, the Company announced that its Board of Directors approved the payment on March 25, 2026 of the Quarterly Cash Dividend to the record holders of shares of the Company’s common stock as of the close of business on March 16, 2026.
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Historical stock price performance should not be relied on as indicative of future stock price performance. ​ Total Return Analysis ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2019 ​ 2020 ​ 2021 ​ 2022 ​ 2023 ​ 2024 Clarus Corporation $ 100.00 ​ $ 114.31 ​ $ 206.49 ​ $ 59.15 ​ $ 52.81 ​ $ 35.28 The Russell 2000 Index $ 100.00 ​ $ 118.36 ​ $ 134.57 ​ $ 105.56 ​ $ 121.49 ​ $ 133.66 NASDAQ Global Select Market $ 100.00 ​ $ 143.04 ​ $ 176.11 ​ $ 118.67 ​ $ 172.13 ​ $ 222.62 ​ Stockholders On March 3, 2025, the last reported sales price for our common stock was $4.44 per share.
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Historical stock price performance should not be relied on as indicative of future stock price performance.
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Total Return Analysis ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2020 ​ 2021 ​ 2022 ​ 2023 ​ 2024 ​ 2025 Clarus Corporation $ 100.00 ​ $ 180.65 ​ $ 51.74 ​ $ 46.20 ​ $ 30.87 ​ $ 23.61 The Russell 2000 Index $ 100.00 ​ $ 113.69 ​ $ 89.18 ​ $ 102.64 ​ $ 112.93 ​ $ 125.68 NASDAQ Global Select Market $ 100.00 ​ $ 123.12 ​ $ 82.96 ​ $ 120.33 ​ $ 155.63 ​ $ 188.00 ​ Stockholders On March 2, 2026, the last reported sales price for our common stock was $3.26 per share.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeItem 6. [Reserved] ​ 36 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 37 Item 7A. Quantitative and Qualitative Disclosures About Market Risk ​ 47 Item 8. Financial Statements and Supplementary Data ​ 49
Biggest changeItem 6. [Reserved] ​ 39 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ 40 Item 7A. Quantitative and Qualitative Disclosures About Market Risk ​ 51 Item 8. Financial Statements and Supplementary Data ​ 53

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changePotential risks and uncertainties that could cause the actual results of operations or financial condition of the Company to differ materially from those expressed or implied by forward-looking statements in this Annual Report on Form 10-K include, but are not limited to, the overall level of consumer demand on our products; general economic conditions and other factors affecting consumer confidence, preferences, and behavior; the potential impact of the uncertain macroeconomic environment on our financial results, including, but not limited to, the effects of sustained global inflationary pressures and interest rates, potential economic slowdowns or recessions, trade restrictions and regulatory changes, and global supply chain disruptions; the effect of inflation on our business, including any future pricing actions taken in an effort to mitigate the effects of inflation and potential impacts on our revenue, operating margins and net income; disruption and volatility in the global currency, capital and credit markets; the financial strength of retail economies and the Company’s customers; the Company’s ability to implement its business strategy; the ability of the Company to execute and integrate acquisitions; the Company’s exposure to product liability or product warranty claims and other loss contingencies, including, without limitation, recalls and liability claims relating to certain avalanche beacon transceivers distributed by BDEL; disruptions and other impacts to the Company’s business, as a result of an outbreak of disease or similar public health threat, and government actions and restrictive measures implemented in response; stability of the Company’s manufacturing facilities and suppliers, as well as consumer demand for our products, in light of disease epidemics and health-related concerns; the impact that global climate change trends may have on the Company and its suppliers and customers, increased focus on sustainability issues as a result of global climate change; regulatory or market responses to global climate change; the Company’s ability to protect patents, trademarks and other intellectual property rights; any breaches of, or interruptions in, our information systems; the ability of our information technology systems or information security systems to operate effectively, including as a result of security breaches, viruses, hackers, malware, natural disasters, vendor business interruptions or other causes; our ability to properly maintain, protect, repair or upgrade our information technology systems or information security systems, or problems with our transitioning to upgraded or replacement systems; the impact of adverse publicity about the Company and/or its brands and products, including without limitation, through social media or in connection with brand damaging events and/or public perception; the potential impact of the Consumer Products Safety Commission’s and the U.S.
Biggest changePotential risks and uncertainties that could cause the actual results of operations or financial condition of the Company to differ materially from those expressed or implied by forward-looking statements in this Annual Report on Form 10-K include, but are not limited to, the overall level of consumer demand for our products; the highly competitive nature of our markets and the potential for rapid or significant changes in consumer preferences; general economic conditions and other factors affecting consumer confidence, preferences, and behavior; the potential impact of the uncertain macroeconomic environment on our financial results, including, but not limited to, the effects of sustained global inflationary pressures and interest rates, potential economic slowdowns or recessions, trade restrictions and regulatory changes, and global supply chain disruptions; the effect of inflation on our business, including any future pricing actions taken in an effort to mitigate the effects of inflation and potential impacts on our revenue, operating margins and net income; disruption and volatility in the global currency, capital and credit markets; the impact of changes in tariffs, tax laws, global trade policies as well as instability and volatility in global markets; the financial strength of retail economies and the Company’s customers; the Company’s ability to implement its business strategy; our ability to accurately forecast demand and manage inventory levels, including the risk of excess or obsolete inventory, increased discounting, or lost sales; the Company’s ability to execute and integrate acquisitions, as well as to complete dispositions and effectively manage the associated separation and transition risks, including those related to the recent sale of PIEPS; the Company’s exposure to product liability or product warranty claims and other loss contingencies, including, without limitation, recalls and liability claims relating to certain avalanche beacon transceivers distributed by BDEL; disruptions and other impacts to the Company’s business, as a result of an outbreak of disease or similar public health threat, and government actions and restrictive measures implemented in response; stability of the Company’s manufacturing facilities and suppliers, as well as consumer demand for our products, in light of disease epidemics and health-related concerns; disruptions in our supply chain, third-party logistics providers, or distribution facilities; the impact that global climate change trends may have on the Company and its suppliers and customers, increased focus on sustainability issues as a result of global climate change; regulatory or market responses to global climate change; compliance costs and potential liabilities related to environmental requirements, including those associated with Per- and Polyfluoroalkyl Substances (PFAS); the Company’s ability to protect patents, trademarks and other intellectual property rights; any breaches of, or interruptions in, our information systems; the ability of our information technology systems or information security systems to operate effectively, including as a result of security breaches, viruses, hackers, malware, natural disasters, vendor business interruptions or other causes; our ability to properly maintain, protect, repair or upgrade our information technology systems or information security systems, or problems arising in connection with our transition to upgraded or replacement systems; the impact of adverse publicity about the Company and/or its brands and products, including without limitation, through social media or in connection with brand damaging events and/or public perception; the potential impact of the Consumer Products Safety Commission’s and the U.S.
Each of our brands has a long history of continuous product innovation for core and everyday users alike. The Company’s products are principally sold globally under the Black Diamond®, Rhino-Rack®, MAXTRAX®, and TRED Outdoors® brand names through outdoor specialty and online retailers, our own websites, distributors and original equipment manufacturers.
Each of our brands has a long history of continuous product innovation for core and everyday users alike. The Company’s products are principally sold globally under the Black Diamond®, Rhino-Rack®, MAXTRAX®, TRED Outdoors®, and RockyMounts® brand names through outdoor specialty and online retailers, our own websites, distributors and original equipment manufacturers.
We continually evaluate our estimates and assumptions including those related to revenue recognition, income taxes and valuation of long-lived assets, goodwill and indefinite-lived intangible assets, and other intangible assets. We base our estimates on historical experience and other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from these estimates.
We continually evaluate our estimates and assumptions including those related to revenue recognition, inventory provisions, income taxes and valuation of long-lived assets, goodwill and indefinite-lived intangible assets, and other intangible assets. We base our estimates on historical experience and other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from these estimates.
We assume no obligation to update any forward-looking statements to reflect events or circumstances after the date of this Annual Report on Form 10-K. 37 Table of Contents Overview Headquartered in Salt Lake City, Utah, Clarus is a global leading designer, developer, manufacturer and distributor of best-in-class outdoor equipment and lifestyle products focused on the outdoor enthusiast markets.
We assume no obligation to update any forward-looking statements to reflect events or circumstances after the date of this Annual Report on Form 10-K. Overview Headquartered in Salt Lake City, Utah, Clarus is a global leading designer, developer, manufacturer and distributor of best-in-class outdoor equipment and lifestyle products focused on the outdoor enthusiast markets.
The multi-period excess earnings method supposes that the owner of the intangible asset is able to achieve a return in excess 39 Table of Contents of that received without the intangible asset through enhanced revenues or cost savings. Our discounted cash flow estimates use discount rates that correspond to a weighted-average cost of capital consistent with a market-participant view.
The multi-period excess earnings method supposes that the owner of the intangible asset is able to achieve a return in excess of that received without the intangible asset through enhanced revenues or cost savings. Our discounted cash flow estimates use discount rates that correspond to a weighted-average cost of capital consistent with a market-participant view.
However, if we do not achieve the results reflected in the assumptions and estimates, our goodwill impairment evaluations could be adversely affected, and we may impair a portion or all of our goodwill, which would adversely affect our operating results in the period of impairment. The market approach identifies the EBITDA multiples of comparable publicly traded companies.
However, if we do not achieve the results reflected in the assumptions and estimates, our goodwill impairment evaluations could be adversely affected, and we may impair a portion or all of our goodwill, which would adversely affect our operating results in the period of impairment. 43 Table of Contents The market approach identifies the EBITDA multiples of comparable publicly traded companies.
We typically apply all three approaches to estimate the fair value of our tangible and intangible tangible assets depending on the type of asset acquired. Business acquisitions may include contingent consideration payments based on various future financial measures, such as sales-based milestones, related to the acquired entity.
We typically apply all three approaches to estimate the fair value of our tangible and intangible tangible assets depending on the type of asset acquired. Business acquisitions may include contingent consideration payments based on various future financial measures, such as sales- 42 Table of Contents based milestones, related to the acquired entity.
If the carrying value of the indefinite-lived asset is higher than its fair value, then 40 Table of Contents the asset is deemed to be impaired and the impairment charge is estimated as the difference. The Company calculates the fair value of its indefinite-lived intangible assets using the income approach, specifically the relief-from-royalty method.
If the carrying value of the indefinite-lived asset is higher than its fair value, then the asset is deemed to be impaired and the impairment charge is estimated as the difference. The Company calculates the fair value of its indefinite-lived intangible assets using the income approach, specifically the relief-from-royalty method.
Our effective income tax rate was an expense of 25.3% for the year ended December 31, 2024, and differed compared to the statutory tax rates primarily due to the impact of recording a valuation allowance on deferred tax assets and the impairment of goodwill and indefinite-lived intangible assets, all of which are non-deductible for tax purposes.
Our 47 Table of Contents effective income tax rate was an expense of 25.3% for the year ended December 31, 2024, and differed compared to the statutory tax rates due to due to the impact of recording a valuation allowance on deferred tax assets and the impairment of goodwill and indefinite-lived intangible assets, all of which are non-deductible for tax purposes.
The increase in cash used during the year ended December 31, 2024, compared to the same period in 2023 was primarily due to the settlement of all outstanding borrowings on our revolving credit facility and term debt under the Restated Credit Agreement.
The decrease in cash used during the year ended December 31, 2025, compared to the same period in 2024 was primarily due to the settlement of all outstanding borrowings on our revolving credit facility and term debt under the Restated Credit Agreement during the year ended December 31, 2024.
We plan to fund these activities through a combination of our future operating cash flows and net proceeds from the sale of our Precision Sport segment. Upon the closing of the sale of the Precision Sport segment, the Company terminated and settled all outstanding borrowings on our revolving credit facility and term debt under the Restated Credit Agreement.
We plan to fund these activities through a combination of our current cash balances and future operating cash flows. Upon the closing of the sale of the Precision Sport segment, the Company terminated and settled all outstanding borrowings on our revolving credit facility and term debt under the Restated Credit Agreement.
The declaration and payment of future Quarterly Cash Dividends is subject to the discretion of and approval of the Company’s Board of Directors. In 2024, 2023 and 2022 our total Quarterly Cash Dividends were $3,831,000, $3,750,000, and $3,721,000, respectively.
The declaration and payment of future Quarterly Cash Dividends is subject to the discretion of and approval of the Company’s Board of Directors. In 2025, 2024 and 2023 our total Quarterly Cash Dividends were $3,840,000, $3,831,000, and $3,750,000, respectively.
On December 1, 2021, the Company completed the acquisition of Australia-based MaxTrax Australia Pty Ltd (“MAXTRAX”). On October 9, 2023, the Company completed the acquisition of Australia-based TRED Outdoors Pty Ltd. (“TRED”). On December 5, 2024, the Company completed the acquisition of certain assets and liabilities constituting the RockyMounts business (“RockyMounts”).
On October 9, 2023, the Company completed the acquisition of Australia-based TRED Outdoors Pty Ltd. (“TRED”). On December 5, 2024, the Company completed the acquisition of certain assets and liabilities constituting the RockyMounts business (“RockyMounts”).
Department of Justice’s investigations related to BDEL’s reporting obligations under the Consumer Product Safety Act in connection with BDEL’s recall of certain models of its avalanche transceivers on our business, results of operations, and financial condition; fluctuations in the price, availability and quality of raw materials and contracted products as well as foreign currency fluctuations; ongoing disruptions and delays in the shipping and transportation of our products due to port congestion, container ship availability and/or other logistical challenges; the impact of political unrest, natural disasters or other crises, terrorist acts, acts of war and/or military operations; our ability to utilize our net operating loss carryforwards; changes in tax laws and liabilities, tariffs, legal, regulatory, political and economic risks; the Company’s ability to maintain a quarterly dividend; our ability to obtain additional capital and funding on acceptable terms to meet our financial obligations as well as to support our business operations and growth strategy; and any material differences in the actual financial results of the Company’s past and future acquisitions, including the impact of acquisitions and any recognition of impairment or other charges relating to any such acquisitions on the Company’s future earnings per share.
Department of Justice’s investigations related to BDEL’s reporting obligations under the Consumer Product Safety Act in connection with BDEL’s recall of certain models of its avalanche transceivers on our business, results of operations, and financial condition; fluctuations in the price, availability and quality of raw materials and contracted products as well as foreign currency fluctuations; ongoing disruptions and delays in the shipping and transportation of our products due to port congestion, container ship availability and/or other logistical challenges; the impact of political unrest, natural disasters or other crises, terrorist acts, acts of war and/or military operations; our ability to utilize our net operating loss carryforwards; changes in tax laws and liabilities, tariffs, legal, regulatory, political and economic risks; the Company’s ability to maintain a quarterly dividend; our ability to obtain additional capital and funding on acceptable terms to meet our financial obligations as well as to support our business operations and growth initiatives; any material differences in the actual financial results of the Company’s past and future acquisitions and dispositions, including the impact of such transactions and any related recognition of impairment or other charges, such as the recent impairments recognized in the Outdoor and Adventure segments and the potential that we may be required to take additional write-downs or write- 40 Table of Contents offs, restructuring charges, impairment charges, or other charges in the future, on the Company’s future earnings per share.
The change was partially offset by increases in gains in mark-to-market adjustments on non-hedged foreign currency contracts during the year ended December 31, 2024.
The change was partially offset by losses in mark-to-market adjustments on non-hedged foreign currency contracts during the year ended December 31, 2025.
The change in net cash provided by (used in) investing activities during the year ended December 31, 2024, is primarily due to the cash received related to the disposition of the Precision Sport segment, compared to the same period in 2023.
The change in net cash provided by investing activities during the year ended December 31, 2025, is primarily due to the cash received related to the disposition of the Precision Sport segment during the year ended December 31, 2024.
Based on the results of the Company’s annual impairment analysis completed as of December 31, 2024, the Company determined that goodwill at the Adventure reporting unit was impaired and recognized a charge of $36,264.
Based on the results of the Company’s annual impairment analysis completed as of December 31, 2025 and 2024, the Company determined that goodwill at the Adventure reporting unit was impaired and recognized charges of $3,804 and $36,264, respectively.
If we do not achieve the results reflected in the market assumptions and forecasted estimates, our indefinite-lived intangibles impairment evaluations could be adversely affected, and we may impair a portion or all of their carrying values, which would adversely affect our operating results in the period of impairment.
If we do not achieve the results reflected in the market assumptions and forecasted estimates, our indefinite-lived intangibles impairment evaluations could be adversely affected, and we may impair a portion or all of their carrying values, which would adversely affect our operating results in the period of impairment. ● Inventory provision – We make ongoing estimates of potential excess, close-out or slow moving inventory.
Based on the results of the Company’s impairment analysis completed as of December 31, 2024, the Company determined that certain indefinite-lived intangible assets, specifically the Rhino-Rack and MAXTRAX trademarks, were impaired and recognized charges of $3,480 and $5,065, respectively, during the year ended December 31, 2024.
Based on the results of the Company’s impairment analysis completed as of December 31, 2025 and 2024, the Company determined that certain indefinite-lived intangible assets in our Adventure reporting unit, specifically the Rhino-Rack and MAXTRAX trademarks, were impaired and recognized charges of $21,600 and $4,469, respectively, during the year ended December 31, 2025, and $3,480 and $5,065, respectively, during the year ended December 31, 2024.
Impairment of Indefinite-Lived Intangible Assets Impairment of indefinite-lived intangible assets increased to $8,545 during the year ended December 31, 2024, compared to impairment of indefinite-lived intangible assets of $0 during the year ended December 31, 2023.
Impairment of Indefinite-Lived Intangible Assets Impairment of indefinite-lived intangible assets increased to $27,634 during the year ended December 31, 2025, compared to impairment of indefinite-lived intangible assets of $8,545 during the year ended December 31, 2024.
Founded in 2005, our MAXTRAX brand offers high-quality overlanding and off-road vehicle recovery and extraction tracks for the overland and off-road market. Similarly, TRED, founded in 2012, is a trusted brand for key retailers and distributors in the overlanding and off-road vehicle recovery market. Clarus, incorporated in Delaware in 1991, acquired Black Diamond Equipment, Ltd.
Founded in 2005, our MAXTRAX brand offers high-quality overlanding and off-road vehicle recovery and extraction tracks for the overland and off-road market. Similarly, TRED, founded in 2012, is a trusted brand for key retailers and distributors in the overlanding and off-road vehicle recovery market.
Net Cash From Financing Activities Net cash used in financing activities was $123,239 during the year ended December 31, 2024, compared to net cash used in financing activities of $20,255 during the year ended December 31, 2023.
Net Cash From Financing Activities Net cash used in financing activities was $5,882 during the year ended December 31, 2025, compared to net cash used in financing activities of $123,239 during the year ended December 31, 2024.
The Company has recorded a valuation allowance of $23,344, resulting in a net deferred tax asset of $12,314, before deferred tax liabilities of $24,488. The Company has provided a full valuation allowance against all of the net U.S. deferred tax assets as of December 31, 2024, because the ultimate realization of those assets does not meet the more-likely-than-not criteria.
The Company has recorded a valuation allowance of $29,315, resulting in a net deferred tax asset of $10,985, before deferred tax liabilities of $12,348. The Company has provided a full valuation allowance against all of the net U.S. deferred tax assets as of December 31, 2025, because the ultimate realization of those assets does not meet the more-likely-than-not criteria.
A reconciliation of free cash flows to comparable GAAP financial measures is set forth below, inclusive of continuing and discontinued operations: ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 ​ 2023 ​ ​ ​ ​ ​ ​ Net cash (used in) provided by operating activities $ (7,300) ​ $ 31,924 Purchase of property and equipment ​ (6,739) ​ ​ (5,717) Free cash flow $ (14,039) ​ $ 26,207 46 Table of Contents ​ Net Cash From Investing Activities Net cash provided by investing activities was $165,160 during the year ended December 31, 2024 compared to net cash used in investing activities of $11,416 during the year ended December 31, 2023.
A reconciliation of free cash flows to comparable GAAP financial measures is set forth below, inclusive of continuing and discontinued operations: ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2025 ​ 2024 ​ ​ ​ ​ ​ ​ Net cash used in operating activities $ (4,746) ​ $ (7,300) Purchase of property and equipment ​ (5,162) ​ ​ (6,739) Free cash flow $ (9,908) ​ $ (14,039) ​ 50 Table of Contents Net Cash From Investing Activities Net cash provided by investing activities was $2,771 during the year ended December 31, 2025 compared to net cash provided by investing activities of $165,160 during the year ended December 31, 2024.
Restructuring Charges Restructuring charges decreased to $1,948 during the year ended December 31, 2024, compared to restructuring charges of $3,223 during the year ended December 31, 2023.
Restructuring Charges Restructuring charges decreased to $967 during the year ended December 31, 2025, compared to restructuring charges of $1,948 during the year ended December 31, 2024.
(“Black Diamond Equipment”) in May 2010 and changed its name to Black Diamond, Inc. in January 2011. In October 2012, we acquired PIEPS Holding GmbH and its subsidiaries (collectively, “PIEPS”). On August 14, 2017, the Company changed its name from Black Diamond, Inc. to Clarus Corporation and its stock ticker symbol from “BDE” to “CLAR” on the NASDAQ stock exchange.
In October 2012, we acquired PIEPS Holding GmbH and its subsidiaries (collectively, “PIEPS”). On August 14, 2017, the Company changed its name from Black Diamond, Inc. to Clarus Corporation and its stock ticker symbol from “BDE” to “CLAR” on the NASDAQ stock exchange. On August 21, 2017, the Company acquired Sierra Bullets, L.L.C. (“Sierra”).
The following presents a discussion of cash flows for the year ended December 31, 2024 compared with the year ended December 31, 2023, inclusive of continuing and discontinued operations. ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 ​ 2023 ​ ​ ​ ​ ​ ​ Net cash (used in) provided by operating activities $ (7,300) ​ $ 31,924 Net cash provided by (used in) investing activities ​ 165,160 ​ ​ (11,416) Net cash used in financing activities ​ (123,239) ​ ​ (20,255) Effect of foreign exchange rates on cash ​ (586) ​ ​ (990) Change in cash ​ 34,035 ​ ​ (737) Cash, beginning of year ​ 11,324 ​ ​ 12,061 Cash, end of period $ 45,359 ​ $ 11,324 ​ Net Cash From Operating Activities Net cash used in operating activities was $7,300 during the year ended December 31, 2024, compared to net cash provided by operating activities of $31,924 during the year ended December 31, 2023.
The following presents a discussion of cash flows for the year ended December 31, 2025 compared with the year ended December 31, 2024, inclusive of continuing and discontinued operations. ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2025 ​ 2024 ​ ​ ​ ​ ​ ​ Net cash used in operating activities $ (4,746) ​ $ (7,300) Net cash provided by investing activities ​ 2,771 ​ ​ 165,160 Net cash used in financing activities ​ (5,882) ​ ​ (123,239) Effect of foreign exchange rates on cash and restricted cash ​ 693 ​ ​ (586) Change in cash and restricted cash ​ (7,164) ​ ​ 34,035 Cash and restricted cash, beginning of year ​ 45,359 ​ ​ 11,324 Cash and restricted cash, end of period $ 38,195 ​ $ 45,359 ​ Net Cash From Operating Activities Net cash used in operating activities was $4,746 during the year ended December 31, 2025, compared to net cash used in operating activities of $7,300 during the year ended December 31, 2024.
Recent Accounting Pronouncements See “Recent Accounting Pronouncements” in Note 1 of our consolidated financial statements. 41 Table of Contents Results of Operations (In Thousands) Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 The following presents a discussion of operations for the year ended December 31, 2024, compared with the year ended December 31, 2023: ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ December 31, 2024 December 31, 2023 ​ ​ ​ ​ ​ ​ Sales ​ ​ ​ ​ ​ Domestic sales $ 105,745 ​ $ 112,385 International sales ​ 158,570 ​ ​ 173,635 Total sales ​ 264,315 ​ ​ 286,020 ​ ​ ​ ​ ​ ​ Cost of goods sold ​ 171,696 ​ ​ 188,509 Gross profit ​ 92,619 ​ ​ 97,511 ​ ​ ​ ​ ​ ​ Operating expenses ​ ​ ​ ​ ​ Selling, general and administrative ​ 111,948 ​ ​ 114,603 Restructuring charges ​ 1,948 ​ ​ 3,223 Transaction costs ​ 576 ​ ​ 593 Contingent consideration benefit ​ (125) ​ ​ (1,565) Legal costs and regulatory matter expenses ​ 3,842 ​ ​ 1,764 Impairment of goodwill ​ 36,264 ​ ​ - Impairment of indefinite-lived intangible assets ​ 8,545 ​ ​ - ​ ​ ​ ​ ​ ​ Total operating expenses ​ 162,998 ​ ​ 118,618 ​ ​ ​ ​ ​ ​ Operating loss ​ (70,379) ​ ​ (21,107) ​ ​ ​ ​ ​ ​ Other income (expense) ​ ​ ​ ​ ​ Interest income, net ​ 1,467 ​ ​ 67 Other, net ​ (1,673) ​ ​ 961 ​ ​ ​ ​ ​ ​ Total other (expense) income, net ​ (206) ​ ​ 1,028 ​ ​ ​ ​ ​ ​ Loss before income tax ​ (70,585) ​ ​ (20,079) Income tax expense (benefit) ​ 17,852 ​ ​ (4,291) Loss from continuing operations ​ (88,437) ​ ​ (15,788) ​ ​ ​ ​ ​ ​ Discontinued operations, net of tax ​ 36,150 ​ ​ 5,642 ​ ​ ​ ​ ​ ​ Net loss $ (52,287) ​ $ (10,146) ​ Sales Total sales decreased $21,705, or 7.6%, to $264,315 during the year ended December 31, 2024, compared to total sales of $286,020 during the year ended December 31, 2023.
There was no activity in discontinued operations during the year ended December 31, 2025. 48 Table of Contents Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 The following presents the Company’s results of operations for the year ended December 31, 2024, compared with the year ended December 31, 2023: ​ ​ ​ ​ ​ ​ ​ Year Ended ​ December 31, 2024 ​ December 31, 2023 ​ ​ ​ ​ ​ ​ Sales ​ ​ ​ ​ ​ Domestic sales $ 105,745 ​ $ 112,385 International sales ​ 158,570 ​ ​ 173,635 Total sales ​ 264,315 ​ ​ 286,020 ​ ​ ​ ​ ​ ​ Cost of goods sold ​ 171,696 ​ ​ 188,509 Gross profit ​ 92,619 ​ ​ 97,511 ​ ​ ​ ​ ​ ​ Operating expenses ​ ​ ​ ​ ​ Selling, general and administrative ​ 111,948 ​ ​ 114,603 Restructuring charges ​ 1,948 ​ ​ 3,223 Transaction costs ​ 576 ​ ​ 593 Contingent consideration (benefit) expense ​ (125) ​ ​ (1,565) Legal costs and regulatory matter expenses ​ 3,842 ​ ​ 1,764 Impairment of goodwill ​ 36,264 ​ ​ - Impairment of indefinite-lived intangible assets ​ 8,545 ​ ​ - ​ ​ ​ ​ ​ ​ Total operating expenses ​ 162,998 ​ ​ 118,618 ​ ​ ​ ​ ​ ​ Operating loss ​ (70,379) ​ ​ (21,107) ​ ​ ​ ​ ​ ​ Other income (expense) ​ ​ ​ ​ ​ Interest income, net ​ 1,467 ​ ​ 67 Other, net ​ (1,673) ​ ​ 961 ​ ​ ​ ​ ​ ​ Total other (expense) income, net ​ (206) ​ ​ 1,028 ​ ​ ​ ​ ​ ​ Loss before income tax ​ (70,585) ​ ​ (20,079) Income tax expense (benefit) ​ 17,852 ​ ​ (4,291) Loss from continuing operations ​ (88,437) ​ ​ (15,788) ​ ​ ​ ​ ​ ​ Discontinued operations, net of tax ​ 36,150 ​ ​ 5,642 ​ ​ ​ ​ ​ ​ Net loss $ (52,287) ​ $ (10,146) ​ For a discussion of our results of operations for the year ended December 31, 2024, compared to the year ended December 31, 2023, please see Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the Securities and Exchange Commission on March 6, 2025. ​ 49 Table of Contents Liquidity and Capital Resources (In Thousands) Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 Our primary ongoing funding requirements are for working capital, expansion of our operations organically, and general corporate needs, as well as investing in the various brands.
Other, net Other, net changed by $2,634, or 274.1%, to ($1,673) during the year ended December 31, 2024, compared to other, net of $961 during the year ended December 31, 2023. The change in other, net was primarily attributable to an increase in remeasurement losses recognized on the Company’s foreign denominated accounts receivable and accounts payable.
Other, net Other, net changed by $3,646, or 217.9%, to $1,973 during the year ended December 31, 2025, compared to other, net of ($1,673) during the year ended December 31, 2024. The change in other, net, was primarily attributable to an increase in remeasurement gains recognized on the Company’s foreign denominated accounts receivable and accounts payable.
On August 21, 2017, the Company acquired Sierra Bullets, L.L.C. (“Sierra”). On October 2, 2020, the Company completed the acquisition of certain assets and liabilities constituting the Barnes business (“Barnes”). On July 1, 2021, the Company completed the acquisition of Australia-based Rhino-Rack Holdings Pty Ltd (“Rhino-Rack”).
On October 2, 2020, the Company completed the acquisition of certain assets and liabilities constituting the Barnes business (“Barnes”). On July 1, 2021, the Company completed the acquisition of Australia-based Rhino-Rack Holdings Pty Ltd (“Rhino-Rack”). On December 1, 2021, the Company completed the acquisition of Australia-based MaxTrax Australia Pty Ltd (“MAXTRAX”).
We estimate that we will incur restructuring costs related to employee-related costs and facility exit costs during the year 2025; however, the Company cannot estimate the total amount expected to be incurred as cost reduction actions continue to be evaluated. The Company anticipates completing these restructuring activities in 2025.
We estimate that we will incur additional employee-related and facility exit restructuring costs in 2026; however, the Company cannot estimate the total amount expected to be incurred at this time as cost reduction actions continue to be evaluated.
Income Taxes Income tax expense (benefit) changed by $22,143, or 516.0%, to an income tax expense of $17,852 during the year ended December 31, 2024, compared to an income tax benefit of $4,291 during the same period in 2023.
Income Taxes Income tax (benefit) expense changed by $28,385, or 159.0%, to an income tax benefit of $10,533 during the year ended December 31, 2025, compared to an income tax expense of $17,852 during the same period in 2024.
Selling, general and administrative expenses at the Outdoor segment decreased by $7,176 primarily as a result of lower retail expenses due to store closures and other expense reduction initiatives to manage costs.
Selling, general and administrative expenses at the Outdoor segment decreased by $3,051 primarily as a result of lower digital marketing and employee-related costs, lower costs from PIEPS due to the sale in July 2025, as well as lower retail expenses due to store closures and other expense reduction initiatives to manage costs.
Gross Profit Gross profit decreased $4,892, or 5.0%, to $92,619 during the year ended December 31, 2024, compared to gross profit of $97,511 during the year ended December 31, 2023. Gross margin was 35.0% during the year ended December 31, 2024, compared to a gross margin of 34.1% during the year ended December 31, 2023.
Gross Profit Gross profit decreased $9,643, or 10.4%, to $82,976 during the year ended December 31, 2025, compared to gross profit of $92,619 during the year ended December 31, 2024. Gross margin was 33.1% during the year ended December 31, 2025, compared to a gross margin of 35.0% during the year ended December 31, 2024.
Interest Income, net Interest income, net increased to $1,467 during the year ended December 31, 2024, compared to interest income, net of $67 during the year ended December 31, 2023. The increase in interest income recognized during the year ended December 31, 2024, was due to interest income on higher cash balances.
Interest Income, net Interest income, net decreased to $619 during the year ended December 31, 2025, compared to interest income, net of $1,467 during the year ended December 31, 2024. The decrease in interest income recognized during the year ended December 31, 2025, was due to lower interest rates on lower cash balances, compared to the prior period.
The restructuring charges incurred during the year ended December 31, 2024 relate to benefits provided to employees who were terminated due to the Company’s reduction-in-force as part of its continued realignment of resources within the organization of $1,824 and lease exit and contract termination costs of $124.
The restructuring charges incurred during the year ended December 31, 2025 relate to benefits provided to employees who were terminated due to the Company’s reduction-in-force as part of its continued realignment of resources within the organization of $937 and lease exit and contract termination costs of $30. 46 Table of Contents Transaction Costs Transaction expense increased to $752 during the year ended December 31, 2025, compared to transaction costs of $576 during the year ended December 31, 2024, which consisted of expenses related to the Company’s various acquisition and disposal efforts.
On February 29, 2024, the Company and Everest/Sapphire Acquisition, LLC, its wholly-owned subsidiary, completed the sale to Bullseye Acquisitions, LLC, an affiliate of JDH Capital Company, of all of the equity associated with the Company’s Precision Sport segment, which is comprised of the Company’s subsidiaries Sierra and Barnes Bullets – Mona, LLC (“Barnes”), pursuant to a Purchase and Sale Agreement dated as of December 29, 2023, by and among, Bullseye Acquisitions, LLC, Everest/Sapphire Acquisition, LLC and the Company (the “Precision Sport Purchase Agreement”).
On February 29, 2024, the Company completed the sale of all of the equity associated with the Company’s Precision Sport segment, which was comprised of the Company’s subsidiaries Sierra Bullets, L.L.C. (“Sierra”) and Barnes Bullets – Mona, LLC (“Barnes”), pursuant to a Purchase and Sale Agreement dated as of December 29, 2023.
Legal Costs and Regulatory Matter Expenses Legal costs and regulatory matter expenses increased to $3,842 during the year ended December 31, 2024, compared to legal costs and regulatory matter expenses of $1,764 during the year ended December 31, 2023.
Legal Costs and Regulatory Matter Expenses Legal costs and regulatory matter expenses increased to $4,682 during the year ended December 31, 2025, compared to legal costs and regulatory matter expenses of $3,842 during the year ended December 31, 2024, which consisted of expenses related to the Company’s specific legal matters.
These costs include severance costs, exit costs, and other restructuring costs and are included in Restructuring charges in the consolidated statements of comprehensive loss. Severance costs primarily consist of severance benefits through payroll continuation, conditional separation costs and employer tax liabilities, while exit costs primarily consist of lease exit and contract termination costs.
Severance costs primarily consist of severance benefits through payroll continuation, conditional separation costs and employer tax liabilities, while exit costs primarily consist of lease exit and contract termination costs.
The majority of the Company’s deferred tax assets consist of research and experimentation credits and capitalized costs for federal tax purposes. These deferred tax assets are expected to reverse into NOL carryforwards that can be used to offset taxable income and reduce income taxes payable in future periods.
The deferred tax assets related to research and experimentation credits and capitalized costs are expected to reverse into NOL carryforwards that can be used to offset taxable income and reduce income taxes payable in future periods. If a change in control were to occur, these future NOLs could be limited under Section 382 of the Code, as amended.
The 2024 transaction costs primarily related to the RockyMounts and TRED Outdoor acquisitions and other expenses related to the Company’s various acquisition efforts. 43 Table of Contents Contingent Consideration Benefit Contingent consideration benefit decreased to $125 during the year ended December 31, 2024, compared to a contingent consideration benefit of $1,565 during the year ended December 31, 2023, which consisted of changes in the estimated fair value of contingent consideration liabilities associated with our acquisitions of MAXTRAX in 2021 and TRED in 2023.
Contingent Consideration Benefit Contingent consideration benefit increased to $355 during the year ended December 31, 2025, compared to a contingent consideration benefit of $125 during the year ended December 31, 2024, which consisted of changes in the estimated fair value of contingent consideration liabilities associated with our acquisitions of TRED in 2023 and RockyMounts in December 2024.
Domestic sales decreased $6,640, or 5.9%, to $105,745 during the year ended December 31, 2024, compared to domestic sales of $112,385 during the year ended December 31, 2023. The decrease in sales was attributable to a decrease in sales at the Outdoor segment of $7,829, partially offset by an increase in sales at the Adventure segment of $1,189.
Domestic sales increased $378, or 0.4%, to $106,123 during the year ended December 31, 2025, compared to domestic sales of $105,745 during the year ended December 31, 2024. The increase in sales was attributable to an increase in sales at the Adventure segment of $2,837, partially offset by a decrease in sales at the Outdoor segment of $2,459.
Free cash flow, defined as net cash (used in) provided by operating activities less capital expenditures, of ($14,039) was used during the year ended December 31, 2024 compared to $26,207 generated during the same period in 2023.
Free cash flow, defined as net cash used in operating activities less capital expenditures, of ($9,908) was used during the year ended December 31, 2025 compared to ($14,039) used during the same period in 2024. The Company believes that the non-GAAP measure, free cash flow, provides an understanding of the capital required by the Company to expand its asset base.
International sales decreased $15,065, or 8.7%, to $158,570 during the year ended December 31, 2024, compared to international sales of $173,635 during the year ended December 31, 2023. The decrease in sales was attributable to a decrease in sales at the Outdoor and Adventure segments of $12,656 and $2,409, respectively.
International sales decreased $14,253, or 9.0%, to $144,317 during the year ended December 31, 2025, compared to international sales of $158,570 during the year ended December 31, 2024. The decrease in sales was attributable to a decrease in sales at the Adventure and Outdoor segments of $10,007 and $4,246, respectively.
Cost of Goods Sold Cost of goods sold decreased $16,813, or 8.9%, to $171,696 during the year ended December 31, 2024, compared to cost of goods sold of $188,509 during the year ended December 31, 2023.
Cost of Goods Sold Cost of goods sold decreased $4,232, or 2.5%, to $167,464 during the year ended December 31, 2025, compared to cost of goods sold of $171,696 during the year ended December 31, 2024.
The decrease in sales was attributable to a decrease in sales at the Outdoor and Adventure segments of $20,485 and $1,220, respectively. 42 Table of Contents Sales in the Adventure segment were reduced by $524 due to foreign exchange impact, compared to the prior period.
The decrease in sales was attributable to a decrease in sales at the Adventure and Outdoor segments of $7,170 and $6,705, respectively. 45 Table of Contents Sales in the Adventure segment were reduced by $1,302 due to foreign exchange impact from the strengthening of the U.S. dollar against the Australian dollar during the year ended December 31, 2025, compared to the prior period.
The change in net cash (used in) provided by operating activities during 2024 is primarily due to the gain on sale of $40,585 related to the disposition of the Precision Sport segment, an increase in net loss of $42,141, and an increase in cash outflows related to working capital of $19,202, compared to the same period in 2023.
The change in net cash used in operating activities during 2025 is primarily due to the gain on sale of $40,585 during the year ended December 31, 2024 related to the disposition of the Precision Sport segment, and an increase in impairment of indefinite-lived intangible assets at the Adventure and Outdoor segments of $19,089, and a decrease in net loss of $5,731 compared to the same period in 2024.
We believe that our liquidity requirements and contractual obligations for at least the next 12 months will be adequately covered by cash provided by operations and the net proceeds from the sale of the Precision Sport segment after the settlement of the Restated Credit Agreement.
We believe that our liquidity requirements and contractual obligations for at least the next 12 months will be adequately covered by our current cash balances and cash provided by operations. Additionally, long-term contractual obligations are also currently expected to be funded from our current cash balances and cash from operations.
Sales in the Adventure segment decreased due to lower demand from original equipment manufacturer (“OEM”) and wholesale customers both in Australia and North America, partially offset by a $3,019 increase from the TRED Outdoors acquisition.
Sales in the Adventure segment decreased due to significantly lower demand from global original equipment manufacturer customers and a challenging wholesale market in Australia for both Rhino-Rack and MAXTRAX, combined with a prior year large wholesale customer in North America not reoccurring in 2025, partially offset by a $5,962 increase from the RockyMounts acquisition.
During the years ended December 31, 2024 and 2023, the Company incurred $1,948,000 and $3,223,000, respectively, of restructuring charges related to these actions. The Company has incurred $5,171,000 of cumulative restructuring charges since the commencement of our restructuring actions in 2023. The Company accrues for restructuring costs when they are probable and reasonably estimable.
The Company has incurred $6,138,000 of cumulative restructuring charges since the commencement of these restructuring actions in 2023. The Company accrues for restructuring costs when they are probable and reasonably estimable. Restructuring costs include severance costs, exit costs, and other restructuring costs and are included in Restructuring charges in the consolidated statements of comprehensive loss.
On August 6, 2018, the Company announced that its Board of Directors approved the initiation of a quarterly cash dividend program of $0.025 per share of the Company’s common stock (the “Quarterly Cash Dividend”) or $0.10 per share on an annualized basis.
On July 11, 2025, the Company completed the sale of PIEPS, which was included in the Company’s Outdoor segment, to a private investment firm for a total purchase price of €7,825,000 (approximately $9,124,000), including cash held at PIEPS of $1,311,000, pursuant to the Share Purchase Agreement. 41 Table of Contents On August 6, 2018, the Company announced that its Board of Directors approved the initiation of a quarterly cash dividend program of $0.025 per share of the Company’s common stock (the “Quarterly Cash Dividend”) or $0.10 per share on an annualized basis.
Gross margin during the year ended December 31, 2024, increased compared to the prior year due to favorable channel mix as a result of lower OEM sales at the Adventure segment and favorable product mix due to the simplification and SKU rationalization strategy at the Outdoor segment.
Gross margin during the year ended December 31, 2025, decreased compared to the prior year as a result of lower volumes at the Outdoor and Adventure segments, impacts due to tariffs imposed by the United States for both segments, and an unfavorable product mix and increases of inventory reserve expenses at the Adventure segment.
These were partially offset by an increase in impairment of goodwill and indefinite-lived intangible assets at the Adventure segment of $44,809, as well as an increase in deferred income taxes of $22,530 during the year ended December 31, 2024, compared to the same period in 2023.
These impacts were partially offset by a decrease in impairment of goodwill at the Adventure segment of $32,460, a decrease in deferred income taxes of $28,159, and an increase in cash outflows related to working capital of $791, compared to the same period in 2024.
Net Operating Loss As of December 31, 2024, the Company had net operating loss carryforwards (“NOLs”) and research and experimentation credit for U.S. federal income tax purposes of $0 and $5,439, respectively. As of December 31, 2024, the Company’s gross deferred tax asset was $35,658.
Net Operating Loss As of December 31, 2025, the Company had net operating loss carryforwards (“NOLs”) and research and experimentation credit for U.S. federal income tax purposes of $41,209 and $5,709, respectively. All federal NOLs will have an indefinite carryforward period. Federal research and experimentation credits have a limited carryforward period and will begin to expire in tax year 2033.
At December 31, 2024, we had total cash of $45,359, compared to cash of $11,324 at December 31, 2023. At December 31, 2024, the Company had $6,477 of the $45,359 in cash held by foreign entities, of which $4,665 is considered permanently reinvested.
At December 31, 2025, the Company had $12,545 of the $38,195 in cash and restricted cash held by foreign entities, of which $8,595 is considered permanently reinvested.
On March 5, 2025, the Company announced that its Board of Directors approved the payment on March 26, 2025 of the Quarterly Cash Dividend of $0.025 to the record holders of shares of the Company’s common stock as of the close of business on March 17, 2025. 38 Table of Contents Restructuring Starting in 2023, the Company began incurring expenses to facilitate long-term sustainable growth through cost reduction actions, consisting of employee reductions, facility rationalization and contract termination costs.
On March 4, 2026, the Company announced that its Board of Directors approved the payment on March 25, 2026 of the Quarterly Cash Dividend of $0.025 to the record holders of shares of the Company’s common stock as of the close of business on March 16, 2026.
These increases were partially offset by an increase in inventory reserve expenses at the Adventure segment. Selling, General and Administrative Selling, general, and administrative expenses decreased $2,655, or 2.3%, to $111,948 during the year ended December 31, 2024, compared to selling, general and administrative expenses of $114,603 during the year ended December 31, 2023.
Selling, General and Administrative Selling, general, and administrative expenses decreased $6,775, or 6.1%, to $105,173 during the year ended December 31, 2025, compared to selling, general and administrative expenses of $111,948 during the year ended December 31, 2024.
Impairment of Goodwill Impairment of goodwill increased to $36,264 during the year ended December 31, 2024, compared to impairment of goodwill of $0 during the year ended December 31, 2023.
See Note 16 to our consolidated financial statements for financial information regarding specific legal matters. Impairment of Goodwill Impairment of goodwill decreased to $3,804 during the year ended December 31, 2025, compared to impairment of goodwill of $36,264 during the year ended December 31, 2024.
The change in net income from discontinued operations was primarily attributable to the pre-tax gain on the sale of the Precision Sport segment of $40,585.
Discontinued Operations Net income from discontinued operations decreased to $0 during the year ended December 31, 2025, compared to net income from discontinued operations of $36,150 during the year ended December 31, 2024. The change in net income from discontinued operations is due to the sale of the Precision Sport segment occurring during the year ended December 31, 2024.
Our effective income tax rate was a benefit of 21.4% for the year ended December 31, 2023, and differed compared to the statutory tax rates due to the impact of officer compensation limitations, partially offset by the impact of tax credits, and permanent book to tax differences related to incentive stock options. 44 Table of Contents Discontinued Operations Net income from discontinued operations changed by $30,508, to $36,150 during the year ended December 31, 2024, compared to net income from discontinued operations of $5,642 during the year ended December 31, 2023.
Our effective income tax rate was a benefit of 18.5% for the year ended December 31, 2025, and differed compared to the statutory tax rates primarily due to the impact of changes in the valuation allowance on deferred tax assets and statutory tax rate differences between foreign jurisdictions and the United States.
Removed
Under the terms of the Precision Sport Purchase Agreement, the Company received net proceeds of approximately $37,871,000 in cash, after payment of certain fees and settlement of the Restated Credit Agreement, for all of the equity associated with the Company’s Precision Sport segment.
Added
Founded in 1993, our RockyMounts brand is known for making well designed and dependable premium bicycle racks and other accessories compatible with vehicles of all sizes. Clarus, incorporated in Delaware in 1991, acquired Black Diamond Equipment, Ltd. (“Black Diamond Equipment”) in May 2010 and changed its name to Black Diamond, Inc. in January 2011.
Removed
The activities of the Precision Sport segment have been segregated and reported as discontinued operations for all periods presented. See Note 3 to our consolidated financial statements for financial information regarding discontinued operations.
Added
On May 8, 2025, BD European Holdings, LLC, a Delaware limited liability company and wholly owned subsidiary of the Company, entered into a Share Purchase and Transfer Agreement (the “Share Purchase Agreement”) to sell all of the issued and outstanding shares of Black Diamond Austria GmbH, together with its operating subsidiary, PIEPS GmbH (collectively, “PIEPS”).
Removed
Sales in the Outdoor segment increased by $235 due to foreign exchange impact, compared to the prior period. Sales in the Outdoor segment decreased due to weakness in our European, independent global distributor (“IGD”), and North American markets, combined with the effects from our product simplification and SKU rationalization strategy.
Added
Restructuring Starting in 2023, the Company began incurring expenses to facilitate long-term sustainable growth through cost reduction actions, consisting of employee reductions, facility rationalization and contract termination costs. During the years ended December 31, 2025, 2024, and 2023, the Company incurred $967,000, $1,948,000, and $3,223,000, respectively, of restructuring charges related to these actions.
Removed
Selling, general and administrative expenses at the Adventure segment increased by $3,806 primarily as a result of investments in global marketing, e-commerce initiatives, and organizational leadership to accelerate growth, as well as the full year impact of the TRED Outdoors acquisition. These increases at the Adventure segment were partially offset by lower intangible amortization expense.
Added
The Company currently anticipates completing these restructuring activities in 2026; however, the timing and scope of these actions may change, and additional actions may be taken, depending on business conditions and other factors.
Removed
Transaction Costs Transaction expense decreased to $576 during the year ended December 31, 2024, compared to transaction costs of $593 during the year ended December 31, 2023.
Added
We evaluate our inventory on hand considering our purchasing plans, sales forecasts, and historical experience to identify excess, close-out, discontinued, or slow moving inventory and make provisions as necessary to properly reflect inventory value at the lower of cost or net realizable value.
Removed
The increase in legal costs and regulatory matter expenses recognized during year ended December 31, 2024 reflects the Company’s accrued liability for the outstanding regulatory matter with the U.S. Consumer Product Safety Commission (“CPSC”) and increased expenses related to the Company’s specific legal matters. See Note 16 to our consolidated financial statements for financial information regarding specific legal matters.
Added
Recent Accounting Pronouncements See “Recent Accounting Pronouncements” in Note 1 of our consolidated financial statements. 44 Table of Contents Results of Operations (In Thousands) Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 The following presents a discussion of operations for the year ended December 31, 2025, compared with the year ended December 31, 2024: ​ ​ ​ ​ ​ ​ ​ Year Ended ​ December 31, 2025 ​ ​ ​ December 31, 2024 ​ ​ ​ ​ ​ ​ Sales ​ ​ ​ ​ ​ Domestic sales $ 106,123 ​ $ 105,745 International sales ​ 144,317 ​ ​ 158,570 Total sales ​ 250,440 ​ ​ 264,315 ​ ​ ​ ​ ​ ​ Cost of goods sold ​ 167,464 ​ ​ 171,696 Gross profit ​ 82,976 ​ ​ 92,619 ​ ​ ​ ​ ​ ​ Operating expenses ​ ​ ​ ​ ​ Selling, general and administrative ​ 105,173 ​ ​ 111,948 Restructuring charges ​ 967 ​ ​ 1,948 Transaction costs ​ 752 ​ ​ 576 Contingent consideration benefit ​ (355) ​ ​ (125) Legal costs and regulatory matter expenses ​ 4,682 ​ ​ 3,842 Impairment of goodwill ​ 3,804 ​ ​ 36,264 Impairment of indefinite-lived intangible assets ​ 27,634 ​ ​ 8,545 ​ ​ ​ ​ ​ ​ Total operating expenses ​ 142,657 ​ ​ 162,998 ​ ​ ​ ​ ​ ​ Operating loss ​ (59,681) ​ ​ (70,379) ​ ​ ​ ​ ​ ​ Other income (expense) ​ ​ ​ ​ ​ Interest income, net ​ 619 ​ ​ 1,467 Other, net ​ 1,973 ​ ​ (1,673) ​ ​ ​ ​ ​ ​ Total other income (expense), net ​ 2,592 ​ ​ (206) ​ ​ ​ ​ ​ ​ Loss before income tax ​ (57,089) ​ ​ (70,585) Income tax (benefit) expense ​ (10,533) ​ ​ 17,852 Loss from continuing operations ​ (46,556) ​ ​ (88,437) ​ ​ ​ ​ ​ ​ Discontinued operations, net of tax ​ - ​ ​ 36,150 ​ ​ ​ ​ ​ ​ Net loss $ (46,556) ​ $ (52,287) ​ Sales Total sales decreased $13,875, or 5.2%, to $250,440 during the year ended December 31, 2025, compared to total sales of $264,315 during the year ended December 31, 2024.
Removed
Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 The following presents the Company’s results of operations for the year ended December 31, 2023, compared with the year ended December 31, 2022: ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2023 ​ 2022 ​ ​ ​ ​ ​ ​ Sales ​ ​ ​ ​ ​ Domestic sales $ 112,385 ​ $ 132,818 International sales ​ 173,635 ​ ​ 182,433 Total sales ​ 286,020 ​ ​ 315,251 ​ ​ ​ ​ ​ ​ Cost of goods sold ​ 188,509 ​ ​ 205,298 Gross profit ​ 97,511 ​ ​ 109,953 ​ ​ ​ ​ ​ ​ Operating expenses ​ ​ ​ ​ ​ Selling, general and administrative ​ 114,603 ​ ​ 120,814 Restructuring charges ​ 3,223 ​ ​ - Transaction costs ​ 593 ​ ​ 2,818 Contingent consideration (benefit) expense ​ (1,565) ​ ​ 493 Legal costs and regulatory matter expenses ​ 1,764 ​ ​ - Impairment of goodwill ​ - ​ ​ 52,071 Impairment of indefinite-lived intangible assets ​ - ​ ​ 40,240 ​ ​ ​ ​ ​ ​ Total operating expenses ​ 118,618 ​ ​ 216,436 ​ ​ ​ ​ ​ ​ Operating loss ​ (21,107) ​ ​ (106,483) ​ ​ ​ ​ ​ ​ Other income (expense) ​ ​ ​ ​ ​ Interest income, net ​ 67 ​ ​ - Other, net ​ 961 ​ ​ (1,035) ​ ​ ​ ​ ​ ​ Total other income (expense), net ​ 1,028 ​ ​ (1,035) ​ ​ ​ ​ ​ ​ Loss before income tax ​ (20,079) ​ ​ (107,518) Income tax benefit ​ (4,291) ​ ​ (14,716) Loss from continuing operations ​ (15,788) ​ ​ (92,802) ​ ​ ​ ​ ​ ​ Discontinued operations, net of tax ​ 5,642 ​ ​ 23,022 ​ ​ ​ ​ ​ ​ Net loss $ (10,146) ​ $ (69,780) ​ For a discussion of our results of operations for the year ended December 31, 2023, compared to the year ended December 31, 2022, please see Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on March 7, 2024. 45 Table of Contents Liquidity and Capital Resources (In Thousands) Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Our primary ongoing funding requirements are for working capital, expansion of our operations (both organically and through acquisitions) and general corporate needs, as well as investing in the various brands.
Added
Sales in the Outdoor segment were reduced by $176 due to foreign exchange impact from the strengthening of the U.S. dollar primarily against the euro during the year ended December 31, 2025, compared to the prior period.
Removed
Additionally, long-term contractual obligations are also currently expected to be funded from cash from operations and net proceeds from the sale of the Precision Sport segment after the settlement of the Restated Credit Agreement. For additional information regarding the Company’s credit facilities, see the section titled “Credit Agreement” below.
Added
Sales in the Outdoor segment decreased due to lower independent global distributor revenue, lower global direct-to-consumer revenue of $2,934, and lower PIEPS revenue of $3,418 due to the sale of PIEPS in July 2025, compared to the prior period.
Removed
The Company believes that the non-GAAP measure, free cash flow, provides an understanding of the capital required by the Company to expand its asset base.
Added
Specifically, the unfavorable product mix at Adventure was primarily driven by promotional sales efforts in North America and higher RockyMounts revenue. This combined with lower wholesale volume at both Rhino-Rack and MAXTRAX in Australia drove the decline in gross margin compared to the year ended December 31, 2024.
Removed
If a change in control were to occur, these future NOLs could be limited under Section 382 of the Internal Revenue Code of 1986 (“Code”), as amended.
Added
Additionally, losses on foreign currency cash flow hedges were $1,585 during the year ended December 31, 2025, which negatively impacted gross margin. These were partially offset by a favorable product mix at the Outdoor segment due to our simplification initiatives.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeOn February 29, 2024, upon the closing of the disposition of the Precision Sport segment, the Company terminated and settled all outstanding borrowings on our revolving credit facility and term debt under the Restated Credit Agreement. The applicable interest rate for the outstanding borrowings under our credit facility as of December 31, 2023 ranged between approximately 7.7% and 9.8%.
Biggest changeOn February 29, 2024, 51 Table of Contents upon the closing of the disposition of the Precision Sport segment, the Company terminated and settled all outstanding borrowings on our revolving credit facility and term debt under the Restated Credit Agreement. Foreign Currency Risks Our consolidated financial statements are denominated in, and our principal currency is, the U.S. dollar.
Our Australian Dollar denominated expenses associated with our Australian operations (which include business operations and distribution facilities) provide a natural hedge for Australian Dollar denominated revenues, however, a significant amount of our finished good inventory purchases are denominated in U.S. dollars.
Our Australian Dollar denominated expenses associated with our Australian operations (which include business operations and distribution facilities) provide a natural hedge for Australian Dollar denominated revenues, however, a significant amount of our finished good inventory purchases are transacted in U.S. dollars.
If a derivative contract is entered into, we either determine that it is an economic hedge or we designate the derivative as a cash flow or fair value hedge. We do not hold derivative financial investments, derivative commodity investments, engage in foreign currency hedging or other transactions that expose us to material market risks. ​ 48 Table of Contents
If a derivative contract is entered into, we either determine that it is an economic hedge or we designate the derivative as a cash flow or fair value hedge. We do not hold derivative financial investments, derivative commodity investments, engage in foreign currency hedging or other transactions that expose us to material market risks. ​ 52 Table of Contents
The Company manages this risk primarily by using currency forward and option contracts. As of December 31, 2024 and 2023, we had entered into foreign currency forward contracts for Euros and Canadian dollars, which qualified as cash flow hedges.
The Company manages this risk primarily by using currency forward and option contracts. As of December 31, 2025 and 2024, we had entered into foreign currency forward contracts for Euros and Canadian dollars, which qualified as cash flow hedges.
For the year ending December 31, 2024, approximately 54% of our sales from continuing operations were denominated in foreign currencies (compared to 54% of our sales from continuing operations in the prior year), the most significant of which were the Australian Dollar, Euro, Canadian Dollar, Norwegian Kroner, and Swiss Franc.
For the year ended December 31, 2025, approximately 51% of our sales were denominated in foreign currencies (compared to 54% of our sales from continuing operations in the prior year), the most significant of which were the Australian Dollar, Euro, Canadian Dollar, Norwegian Kroner, and Swiss Franc.
Given the current geopolitical environment and other economic uncertainties worldwide, changes in these and other currencies in relation to the U.S. dollar will affect our sales and profitability and could result in foreign exchange losses.
We transact business predominantly in U.S. dollars, Australian dollars, Euros (EUR), and Canadian dollars ($CAD). Given the current geopolitical environment and other economic uncertainties worldwide, changes in these and other currencies in relation to the U.S. dollar will affect our sales and profitability and could result in foreign exchange losses.
As of December 31, 2024 and 2023, the aggregate notional amounts of Euro contracts were EUR 6,711,000 and EUR 20,612,000, respectively, and the aggregate notional amounts of Canadian dollar contracts were $CAD 1,379,000 and $CAD 7,925,000, respectively.
As of December 31, 2025 and 2024, the aggregate notional amounts of Euro contracts were EUR 3,134,000 and EUR 6,711,000, respectively, and the aggregate notional amounts of Canadian dollar contracts were $CAD 1,208,000 and $CAD 1,379,000, respectively.
Interest Rate Risks Our primary exposure to market risk is interest rate risk associated with credit facilities since the interest is indexed to market rates.
Interest Rate Risks Our primary exposure to market risk is interest rate risk associated with potential credit facilities since the interest would be indexed to market rates. As of December 31, 2025, the Company has no outstanding borrowings under any credit facilities.
Removed
The amount outstanding as of December 31, 2023 was $119,750,000. 47 Table of Contents Foreign Currency Risks Our consolidated financial statements are denominated in, and our principal currency is, the U.S. dollar. We transact business predominantly in U.S. dollars, Australian dollars, Euros (EUR), and Canadian dollars ($CAD).

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