Outdoor Holding Co

Adjusted EBITDA

Adjusted EBITDA is a non-GAAP financial measure that displays our net income (loss) from continuing operations (the most directly comparable financial measure prepared in accordance with GAAP), adjusted to eliminate the effect of certain items described below. We define Adjusted EBITDA as net income (loss) from continuing operations excluding (i) provision or benefit for income taxes, (ii) depreciation and amortization, (iii) interest expense, net, (iv) stock-based compensation expenses relating to stock awards and common stock purchase options, (v) interest and other income (expense), net, (vi) expenses related to acquisitions and divestitures, (vii) gain on extinguishment of debt, (viii) professional service and legal fees related to an investigation conducted by a special committee of the Board of Directors (the “Special Committee Investigation”), an investigation by the SEC (“the SEC Investigation”) and the now-settled lawsuit related to the GunBroker acquisition (the “Delaware Litigation”) (ix) other nonrecurring expenses, such as contingencies associated with litigation or settlements and (x) corporate restructuring costs related to headcount reductions, severance, and expense consolidation.

We believe that it is useful to exclude these expenses because the amount of such expenses in any specific period may not directly correlate to the underlying performance of our business operations. Non-GAAP financial measures have limitations, should be considered as supplemental in nature and are not meant as a substitute for the related financial information prepared in accordance with GAAP. These limitations include the following:

Because of these limitations, you should consider the non-GAAP financial measures alongside other financial performance measures, including our net income (loss) from continuing operations and our other financial results presented in accordance with GAAP.

*Per share amounts may not sum due to rounding