ANNUAL REPORT2016 - 2017

CONTENTS

Who We Are •StateofChildhoodPoverty •OurMission

Service Accomplishments •Transparency&Efficiency •EmployeeVolunteerProgram •RUNINSPIRED10K •WebsiteRedesign

Partners Spotlight •Firefighters •Rotary •Foundation •Corporate

Impact & Financials •2016FinancialHighlights •2017FinancialHighlights •Impact •MajorContributions

BoardMembers&Officers

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WHO WE ARE

State of Childhood Poverty

KeyindicatorsoverthepastyearwouldsuggesttheUnitedStates’economyisimproving.Unemploymentisbelow5%.RealGDPishigherduringthefirsthalfof2017over2016.TheS&P500hasgrownsteadilyoverthelast18months.

ButthelatestCensusdatashowspovertyinAmerica,particularlyforchildren,isanongoingissuethathasshownonlyslightimprovement.Theaverageincomeofpeopleinthelowest20percentofhouseholdsremainslowerthanitwasbeforetherecession.In2016,thepovertyrateforchildrendroppedto18%from19.7%,butstillleavesover13millionchildrenstrugglingtosurviveeachandeverydayacrossourcountry.Forafamilyoffour,youraverageyearlyhouseholdincomeforthoseinpovertyislessthat$25,000.

Whilethecountryshowssignsofeconomicgrowth,nearlyoneinfivechildrenarestillbeingleftbehind.Forchildrenthatstrugglewithdailyessentialslikefood,shelterandclothing,OperationWarmmaintainsitsfocusonprovidingwarmth,hopeandhappinessforchildrenwhoneeditthemost.

OperationWarm’swarm,colorful,brandnewwintercoatshelptoincreaseself-esteem,peeracceptance,schoolattendance,andoverallwellness.Supportinalloftheseareasgiveschildrenlivinginpovertyagreaterchancetobehappyandsuccessfulinlife.

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WHO WE ARE

Our Mission

OperationWarmisanonprofitorganizationthatprovidesbrandnewwintercoatstochildreninneed.Weapplaudcoatdriveprogramsthatgiveusedwintercoatstochildren,butabrandnewwintercoatgoesbeyondphysicalnecessity.Webelieveanewwintercoatcanbemorethanacoat.Webelieveitcantellachild,“You’reworthit,”andhelptobuildself-esteemthroughprideinownership.Webelieveitcaninspirehappinessandwarmthwithinachildwhilealsoincreasingpeeracceptancebothinsideschoolandoutsidewhileatplay.

Supportinalloftheseareasgiveschildrenlivinginpovertyagreaterchancetobehappyandsuccessfulinlife.

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SERVICE ACCOMPLISHMENTS

Transparency&Efficiency

OperationWarmfunctionsasahighlyefficientnonprofitorganization.In2016-2017,over 95% of our fundingwentdirectlytoourcoatprograms.Inorderforustoaccomplishthis,werelyheavilyonourprogrampartners,whoactasanextensionofourmission.

Overthe2016-17coatseason,wepartneredwithover800organizationsacrossthecountry,whoareessentialinstretchingeverydollarthatisdonatedtousandourcoatprograms.

Ourpartnerscomefromavarietyofbackgrounds-fromcommunityserviceandmunicipalclubs,tolocalbusinessesandgovernmentorganizations.Theyallworkdiligentlytoidentifychildreninneed,fundraise,visitschoolsandyouthorganizations,andgiveoutourcolorfulnewcoats.Thispastyear,wehadactivepartnersinall50statesandWashingtonD.C.andhelpedhundredsofthousandsofchildren.

Andbecauseofourtransparencyinreportingandfocusonefficiency,wewereoneofthefirsttobeawardedthePlatinumSealofTransparencyfromGuideStar©,theworld’slargestsourceofinformationonnonprofitorganizations.

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SERVICE ACCOMPLISHMENTS

Employee Volunteer Program

Duringthefallof2016,OperationWarmlaunchedanewsolutiontohelpincreaseourengagementandfundingopportunitieswithourcorporatepartners–employeevolunteerprogram.

Ouremployeevolunteerprogramisafull-service,turn-keyeventthatgivesupto50volunteersfromanorganizationahalf-dayexperienceprovidingnewcoatstochildreninneed.OperationWarmstaffmembersruntheeventfromtoptobottom,completewithbeneficiaryplanning,coatdelivery,eventset-up,andvolunteercoordination.

Volunteershelppreparetheschoolgym/cafeteriaforthecoatgivingevent,unpackandorganizecoats,helpchildrenselectacoat,organizephotographyopportunities,eventclean-up,andhelpcontributetoageneralatmosphereofpositivityandenthusiasm.

Forthecorporatepartner,thevalueisfive-fold: •HR Value–employeevolunteerprogramsimprove employeerecruitment,engagementandretention. •Reputation–PRandmarketingoftheeventimproves brandreputation,aidingbusinessesintheircorporate socialresponsibility. •Culture–coatgivingeventsareapositiveexperienceto addtoyourcorporateculture. •Ease–programsarecustom-builtforeacheventaround abusiness’sscheduleandlocation. •Expertise–OperationWarmprovidesafull-service employeevolunteerprogrambuilton18yearsof experience.

FirstyearparticipantsoftheprogramincludedFedEx,HollisterCo.,IGSEnergy,Lazard,andTwitter.

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SERVICE ACCOMPLISHMENTS

RUN INSPIRED 10K at Winterthur

OperationWarmfounderandCEO,DickSanford,hasoneamazinggrandson.NikToochekistheyoungestpersontocompletemarathonsonallsevencontinents,allinthenameofsupportingvariouscharities(includingOperationWarm).

ThisamazingfeatinspiredDickandtheteamatOperationWarmtocreatetheirowncharityrace–RUNINSPIRED10K.

RUNINSPIRED10Klaunchedinthefallof2016,takingplacewithinthebeautifulgroundsofWinterthurMuseum,GardensandLibraryinWinterthur,DE.Thecoursewaslaidoutamongstthe1,000acrepreserveandfeaturedapost-racefinisher’spartywithlivemusic,foodtrucks,familyactivitiesandabeergarden.Mostimportantly,aportionofeachregistrationfeeprovidedanewOperationWarmcoatforachildinneed.

Theinauguralracewasahugesuccesswithover1,600participants,makingitthefourthlargestroadraceinDelaware!Mostimportantly,1,600newcoatsfoundhomesinthehandsofchildreninneedthroughouttheDelawareValley.

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SERVICE ACCOMPLISHMENTS

Website Redesign

Thedigitalworldisincreasinglyintersectingwiththerealworldatadizzyingpace.OperationWarm’swebsitewasinneedofrenovation,sooverthecourseof2016wefocusedoureffortsonmakingiteasierthaneverforoursupportersandpartnerstoengagewithusonline:

• UpdatedWebsite–OperationWarmlauncheda completelyredesignedwebsiteinAugustof2016. Thenewplatformhasaneasy-to-usenavigationanduser experience,iscompletelydeviceresponsive,allowsus toeasilycommunicateourimpactandprovidesroomfor futureexpansionandgrowth.

• NewDonationPlatform–integratedintoourupdated websiteisanewdonationplatformcourtesyofClassy.org. TheClassyplatformallowsfornotonlythecreationof donationpages,butpeer-to-peerfundraisingandevents ticketingpagesaswell.Likethewebsite,theplatformisfully deviceresponsiveandallowsforeasierintegrationofvideo andsocialmediasharing.

• OnlineRevenueGrowth–aftermonthsofwork,the newadditionspaidoff.OperationWarmanditsfundraising partners’onlinerevenueincreasednearly60%overthe previousseason.

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PARTNER SPOTLIGHT

PittsburghFirefighter,Local#1

In2012,theInternationalAssociationofFirefighters(IAFF)heldtheirGeneralConventioninPhiladelphia.AresolutionwasunanimouslypassedtopartnerwithOperationWarmtoallowFirefighterLocalsacrossthecountrytheabilitytopartnerwithOperationWarmtoprovidenewcoatstochildreninneedintheircommunities.ThePittsburghFirefighters,Local#1wereoneofthefirsttoanswerthecall,joiningOperationWarmin2012.Sincethen,they’vegoneaboveandbeyondtohelpchildreninneedthroughoutPittsburgh.

It’squiteremarkableconsidering...

•PittsburghFirefighters,Local#1wasthesecondprogramtojoin FFOWin2012(behindFairfaxCounty)

•10,500childrenservedsince2012

•FundraisingEvents:NightattheRaces–pre-recordedhorserace betting,silentauction,etc.heldattheFirefightersunionhall.

•CorporateSponsors: -MSA$15,000 -Google$11,000 -PittsburghPenguinsFoundation$10,000 -HeinzFoundation$8,000 -ScaifeFoundation$8,000 -HeinzEndowments$5,000 -PNC$5,000

•Maincoatgivingeventisheldattheunionhallwhichisinavery roughPittsburghneighborhood.Theyinviteallofthechildren fromtheneighborhoodtocomeandgetcoats.Additionalcoats aredistributedtolocalschools.

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PARTNER SPOTLIGHT

Rotary District 6000

Sinceitsfoundation,OperationWarmhasworkedcloselywithRotariansacrossthecountry.Theirmottotoput“ServiceAboveSelf”ties-indirectlywithOperationWarm’smission. Overthepast4years,RotaryDistrict6000haspartneredwithOperationWarmtoprovidehappinessandwarmthtochildrenacrossIowa.Theircoatprogramisacombinedeffortofover25Rotaryclubs,schooldistricts,nonprofitsandKiwanisclubs. Eachyear,theyfundraiseover$60,000towardsthegiftofbrandnewcoats.Todate,they’veprovidedmorethan20,000OperationWarmcoatstochildreninneed.

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PARTNER SPOTLIGHT

Weinberg Foundation

TheBaltimorebasedHarryandJeanetteWeinbergFoundationhaspartneredwithOperationWarmsince2010.OneofthelargestprivatecharitablefoundationsintheUnitedStates,theirsolepurposeisassistinglow-incomeandvulnerableindividualsandfamilies.Eachyear,theirsupportprovidesbrandnewwintercoatstohomelesssheltersinBaltimoreandincorporatesOperationWarmintothe“wraparound”supporttheyprovidetoBaltimoreCitySchoolsstudentsthroughtheiraward-winningBaltimoreLibraryProject.

ThroughtheLibraryProject,thegiftofanewwintercoatinspireshopeandempowerschildrentoattendschoolregularly,whileimprovingtheirself-esteem.WithbrandnewlibrariesbeingretrofittedbytheWeinbergFoundation,itisawonderfulopportunitytoassurestudentsreceivethisbasicneed,whichwillhelpthemfeelprideinthemselvesandtheirschools,andensuretheyarepoisedforacademicsuccess.Todate,OperationWarmandtheWeinbergFoundationhavebroughthappinessandwarmthwiththegiftofanewcoattoover9,000WeinbergLibrarySchoolstudents.

“Itisatremendoushelptoourorganizationthatweareabletoprovidefamilieswithcoatsfortheirchildren.OperationWarmprovidesabasicneedthateverychildisentitledtohave,butoftendoesn’t.Thankyouforcontinuingyouramazingservicetothoselessfortunate.”- Baltimore Outreach Services

“Thechildrenweresogratefulforreceivingacoatandforthecaringconversationsfromthevolunteers.ThechildreninthelowergradesweartheircoatsALLDAYlong!!!Theydonotwanttotakethemoff.”- Morrell Park Elementary Middle School

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PARTNER SPOTLIGHT

HollisterCo.“Let’sGiveBackTogether”

The“GiveBackTogether”campaigncametolifeinFall2016.HollisterandOperationWarmpartneredforthesecondyeartoengageconsumersandemployeesinacampaigntosharetheholidayspiritandprovidechildreninneedaroundthecountryabrandnewwintercoat.InHollisterstoresaroundthecountryconsumerswereinvitedtoparticipateintheBuyOneGiveOnecoatcampaignorroundupattheregister.InthedigitalspaceHollistercreatedaspecialcampaignfilteronSnapchat.And,aroundthecountryHollisteremployeeswereinvitedtovolunteertodistributethecoatsat5regionalgivingevents.Employeesdeliveredmorethanacoattoeverychildatthefiveschools;witheachcoattheydeliveredaboostinself-esteem,asenseofcommunity,warmth,hopeandjoy.

The“Let’sGiveBackTogether”campaignwastremendouslysuccessfulinfundsraised,numberofcoatsdonated,consumerengagement,andincreasedawarenessofthepartnershipandOperationWarm’smission.

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IMPACT & FINANCIALS

2016 Financial Highlights

2017 Financial Highlights

Impact

2.3 million coats given since 1998

95%Program Efficiency

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IMPACT & FINANCIALS

Major Contributions

Gifts of $50,000 or MoreAbercrombie&FitchAutoDealersCARingforKidsFoundationMr.andMrs.AnsonBeardCarnivalFoundationCoatsforKidsClevelandCradlestoCrayons-BostonDetroitandGrossePointeRotaryClubsFedExCorporationFirstBookMilwaukeeProfessionalFirefightersOhioGovernor’sOfficeofFaithBasedandCommunityInitiativesPat’sCoatsforKidsPennsylvaniaDepartmentofPublicWelfareSalvationArmy-TwinCitiesTheCrownFamilyTheDavenportFamilyFoundationWellsFargo

Gifts of $25,000 or MoreChicagoCommunityTrustChicagoHousingAuthorityChildrenFirstFundCruiseIndustryCharitableFoundationInc.EQTFoundationFairfaxCountyProfessionalFirefighters&ParamedicsGoodSamaritanInc.IGSEnergyLincolnProfessionalFirefightersManchesterNHFirefightersMinneapolisFirefightersMississippiBendAreaEducationAgencyMr.TerrenceMcGlinn&Mrs.BarbaraMcGlinnNewCharlotteChurchOperationNorthPole,Inc.PittsburghProfessionalFirefightersProfessionalFirefightersofEasternMissouriMr.andMrs.RichardD.SanfordTheGallagherFamilyFoundationTheHarryandJeanetteWeinbergFoundationThriventFinancialCharlotteWawa,Inc.YoungstownRotaryFoundation

Gifts of $10,000 or MoreAltriaGroup,Inc.Mr.andMrs.BasilL.AndersonAssistanceLeagueofSoutheasternMichiganBlueCrossBlueShieldofIllinoisBuncherFamilyFoundationColumbiaGasofMassachusettsCombinedFederalCampaignoftheNationalCapitalAreaComEdDominionFoundationDuquesneLight

ExelonGenerationGoogleGravitateDesignStudio,LLCHagerstownProfessionalFirefightersHarvestChurchKidz-N-CoatsHorizonServices,Inc.ImpactChurchLonestarIvoryEllaKeeneProfessionalFirefightersLakeForest/LakeBluffMorningRotaryClubLazardFrères&Co.LLCLittleRockProfessionalFirefightersLorainCountyCommunityActionAgencyMauerChevroletMr.TomMcCallMr.DanandEugeniaMezzalinguaMr.MichaelMoranMSANorthAmericaNashvilleProfessionalFirefightersOilCityProfessionalFirefightersPittsburghPenguinsFoundationPNCFoundationofErie,PAPolkBros.FoundationMr.GregoryPrattProfessionalFirefightersofMassachusettsPuyallupTribeofIndiansCharityTrustRentonRotaryRhinoMarkingandProtectionSystemsRichlandProfessionalFirefightersRockfordPublicSchoolsRotaryClubofBridgeportRotaryClubofMarshalltownRotaryClubofWinchesterVARotaryClubofWinnetkaNorthfieldRoundRockAreaServingCenterSalvationArmy-Greene&ChristianCountiesSanofiGenzymeScottSpinoFoundationSorensonLegacyFoundationSt.PaulFirefightersStaffordProfessionalFirefightersStephen&MaryBirchFoundation,Inc.TaylorMIRotaryClubTDCharitableFoundationTheDonaldB.andDorothyL.StablerFoundationTheJohnCrainKunkelFoundationTheLaffey-McHughFoundationTheMayor’sFundforPhiladelphiaTheNoraRobertsFamilyFoundationTheTaylorRotaryFoundationDAFTumwaterProfessionalFirefightersTwitterUniqueIndustries,Inc.VertexPharmaceuticalsIncorporatedWalgreensWorcesterEducationalDevelopmentFoundation,Inc.

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IMPACT & FINANCIALS

Major Contributions

Gifts of $5,000 or MoreAmazonAnchorageProfessionalFirefightersAveryBradley-LandmarkSportsBatesvilleBoardofRealtorsBerlinProfessionalFirefightersBoiseProfessionalFirefightersBryanProfessionalFirefightersCBREMinneapolisChambersFamilyFoundationChicagoTeachersUnionFoundationCities97ClackamasSunriseRotaryCoalitionfortheHomelessCoatsforKidsWyomingComcastCorporationCommunityHospitalAndersonConocoPhillipsAlaskaCorinaHigginsonTrustCrestleaFoundation,Inc.CVRAssociates,Inc.Mr.andMrs.JohnB.DohertyEarlyRisersKiwanisClubofWestBendEastonProfessionalFirefightersMr.D.TrowbridgeEllimanExelonGeneration-LimerickGeneratingStationF.I.S.H.Foundation,Inc.FogliaFamilyFoundationForgottenChildFund,Inc.FredB.andOpalS.WoosleyFoundationInc.G.C.MurphyCompanyFoundationGoodNewsMediaIncWLJNFuelFMGrandIslandProfessionalFirefightersGreatFallsProfessionalFirefightersHelpMeGrowHighmarkBlueCrossBlueShieldHudiburgAutoGroupJohnstownProfessionalFirefightersKalispellProfessionalFirefightersKentProfessionalFirefightersKeystoneCoatsforKidsKnoxvilleFirefightersAssociationLaconiaProfessionalFirefightersLaneProfessionalFirefightersLubbockProfessionalFirefightersM.B.&EdnaZaleFoundationMarquetteAssociates,Inc.McLeanBibleChurchMerrittProperties,LLCMinervaAreaCoatsForKids

MorganStanleyMountOliveCollegeMuckleshootIndianCasinoNanMcKay&Associates,Inc.NorthGreeceProfessionalFirefightersNorthwestChildren’sOutreachPeople’sUnitedCommunityFoundationPepperHamiltonLLPPierceCountyProfessionalFirefightersPocatelloProfessionalFirefightersPortlandFirefightersAssociationMs.ClaireReidRidgeRoadProfessionalFirefightersAssociationRotaryClubofBeavertonORRotaryClubofCentervilleOHRotaryClubofHamdenRotaryClubofKitchenerFoundationRotaryClubofNorwichCTRotaryClubofWaukeganSalvationArmyofLincolnSantaFundoftheGreaterLakesRegionScaifeFamilyFoundationSitInvestmentAssociates,Inc.Mr.WilliamSladekSouthKingCountyProfessionalFirefightersSouthportCongregationalChurchSt.MalachyPreciousBloodParishTeamDetroitTempleProfessionalFirefightersTheAllerganFoundationTheAnneL.&GeorgeH.ClappCharitable&EducationalTrustTheHarrMotorGroupTheJohnClarkeTrustTheLafonFoundationTheLindquist&VennumWinterClosetFoundationTheRichardC.MunroeFoundation,Inc.TheTJXFoundationTheXeroxFoundationTigardNoonRotaryClubORTripwireFundofTheOregonCommunityFoundationUniversalTelevision,LLCURSpecialMinistriesWaterlooDowntownRotaryWholeFoodsMarketWIBHRadioWilmingtonTrustCompanyMs.SueWilsonWoodfieldAreaChildren’sOrganizationWoodinvilleRotaryClub

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BOARD MEMBERS & OFFICERS

Meet Our Board of Directors

BarryAbelson

BasilAnderson

SusanBailey

WillieF.Bailey,Sr.

ScottA.Beaumont

MarthaACarr

JBDoherty

KristenHamer

WilliamIredale

WilsonKing

GregPratt

ClaireReid

GeoffRogers

RichardSanford

TaraToocheck

RandyHarward-AdvisoryCounsel

Mrs.J.Maxwell“Betty”Moran-EMERITUS

Board Member Spotlight

SusanBaileyisnotonlyournewestboardmember,sheisaprincipalandpracticeleaderforCorporateSolutionsConsultingbasedinDenver,CO.Ahighlyaccomplishedexecutivewith35yearsofbroad-basedgeneralmanagementexperienceintheglobalinformationtechnologyandcommunicationsindustries,Susanhasbuiltasolidreputationforconsistentlyincreasingtoplinerevenueandgrossmargins,developingandgrowingnewbusinesssegments,designinginnovativesales,marketingandservicesstrategies,redefiningbusinessprocessesandcontrollingexpenses.

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BOARD MEMBERS & OFFICERS

Richard D. Sanford - Founder & CEODickisalifelongentrepreneurandphilanthropist.HebeganhiscareeratArthurAndersonandwasVPofFinanceandExecutiveVicePresidentofCommodoreInternational.HewentontofoundIntelligentElectronics,whichgrewtoa$3.7billiondollarwholesaledistributorofmicro-productsandservices.In1998DickstartedTheSanfordFoundationtosupportdisadvantagedchildren.ThefirstcharterschoolinPennsylvaniawasanearlyproductandtodaythatschool,knownasTheChesterCountyFamilyAcademy,operatesinWestChester,PA.HehasservedontheBoardoftheBrandywineMuseumandConservancy.In1998DickfoundedOperationWarm.

Stephanie Cohen - CFOStephanieCohencurrentlyservesasChiefFinancialOfficer.Shebringsmorethan20yearsoffinance,operations,andconsultingexperiencewithafocusonbusinessdevelopment(mergers&acquisitions,publicofferings),processimprovement,andfinancialcontrolinbothpublicandprivatecompanies.SheservedasSVPandCFOofAllianceConsulting(acquiredbySafeguardScientifics);EVPandCFOofXLConnectSolutions(acquiredbyXerox,formerlyownedbyIntelligentElectronics);andinvariousexecutivecapacitiesatIntelligentElectronics.Ms.CohenhasaBSAccountancyfromtheUniversityofIllinois,Urbana-ChampaignandisaCPA,havingstartedhercareerwithKPMGPeatMarwick.

MeetOurOfficers

www.operationwarm.org