More shareholder drama ahead of Smith & Wesson annual meeting
A Smith & Wesson proxy adviser raised questions over the company’s board nominees and donations to industry groups last week, prompting a lengthy defense from the gun maker ahead of its annual meeting later this month.
Parent company American Outdoor Brands defended its actions in a regulatory filing published Thursday, telling Glass, Lewis and Co. its concerns were unfounded and called its support for a gun safety report “disappointing.”
“In making that recommendation, Glass Lewis concedes that the issues are difficult and ‘sensitive’ and that the ‘Company should act in the best long-term interests of its shareholders,’” the gun maker writes in its filing with the Securities and Exchange Commission, insisting the report will destroy shareholder value for the benefit of a few, anti-gun special interest groups.
Smith & Wesson also defended its nominee, Mitchell Saltz, saying his role on the board of VirTra Systems, a company specializing in virtual reality gun training simulators, doesn’t pose a conflict of interest.
Glass, Lewis and Co. advised other shareholders to reject Saltz and four other nominees in a letter sent Tuesday after the former “inadvertently omitted” his connection to VirTra. The advisory firm — in what Reuters reported as an “unusual” step — changed its recommendation Thursday, instead expressing support for all nominees except Saltz.
Smith & Wesson said VirTra doesn’t compete with the gun maker’s training academy — a “customer service” benefit designed to educate law enforcement clientele on maintenance and proper use exclusively of Smith & Wesson firearms. VirTra markets its simulators to law enforcement and military, but does not provide armorer training or limit the brand of firearm used in its programs.
“In fact, there is very little, if any, overlap in the services that are provided by VirTra Systems and the Smith & Wesson Academy,” the filing concludes.
Smith & Wesson goes on to defend its unreported $1.5 million donations to the National Rifle Association and the National Shooting Sports Foundation, noting the company didn’t break any disclosure policies because the money didn’t support political activities.
Shareholders will vote on these issues at the gun maker’s annual meeting Sept. 25. It’s unclear if major investors — such and BlackRock and Vanguard — will support a proposed gun safety risk report, as both did during Sturm, Ruger and Company’s annual meeting in May.
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