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MEMORANDUM TO: SUBJECT: Whom It May Concern Status of Sharps Rifle Company LLC, Merwin, Hulbert & Co.

LLC, ASquare of South Dakota LLC and A-Square of Wyoming LLC and related brands and divisions including but not limited to H H Heiser, Sharps Mil Spec, Pope Barrels, et al. March 15, 2012


In August of 2011, faced with the pending insolvency of Sharps Rifle Company, LLC, Merwin, Hulbert & Co., LLC, A-Square of South Dakota LLC and A-Square of Wyoming LLC, Michael Blank, the CEO engaged the Advisory Services of Kevin Tierney and William Martin. Following an exhaustive analysis of the businesses of A-Square South Dakota LLC, A-Square Wyoming LLC, Merwin, Hulbert & Co. LLC, and Sharps Rifle Company LLC, Michael Blank, with the assistance of Kevin Tierney and William Martin determined in early October 2011 that A-Square of South Dakota LLC and A-Square of Wyoming LLC as well as Merwin, Hulbert & Co. LLC and Sharps Rifle Company LLC were insolvent and no longer viable. Employees in both A-Square locations were let go. A-Square of South Dakota’s secured creditor was notified that the company’s operations had ceased and its facility and contents were turned over to the building’s owner and the secured creditor. In addition, Sharps Rifle Company LLC’s main office in St. Louis was closed. Further, on February 15, 2012, Michael Blank conveyed all of the equipment located in Glenrock, WY belonging to A-Square of Wyoming LLC as well as all of the intangible assets belonging to A-Square South Dakota and Wyoming, Merwin, Hulbert & Co. LLC and Sharps Rifle Company, LLC to Sharps Rifle Company, Inc. a Wyoming corporation formed by Kevin Tierney and William Martin. On or about February 15, 2012, Kevin Tierney, the CEO of the new Sharps Rifle Company, Inc. informed the Town of Glenrock, WY that A Square of Wyoming LLC was defaulting on its lease with the town and that Sharps Rifle Company, Inc. would like to present a proposal to the town that would afford Mr. Tierney and his partner, William Martin (President & COO) the time necessary to raise $1,300,000 in order to re-launch operations of the new Sharps Rifle Company, Inc. in the Glenrock, WY facility. Mr. Tierney was invited by the Glenrock Town Council to present his proposal at a meeting on February 27, 2012. Mr. Tierney explained his reasons for closing the Glenrock facility and described the financial condition of the old companies as “toxic” if not “radioactive”. He told the Council that “there is financial tragedy across the board”. He further explained that the State of South Dakota and one of its major financial institutions had lost a lot of money. Mr. Tierney also indicated that the State of Wyoming and the Town

of Glenrock had believed in a lot of people. He then took care to cite the numerous consumers who had invested money in firearms that were never delivered and assured the Town Council that if they looked favorably upon the proposal, that it is the intention of the new Sharps Rifle Company, Inc. “to make right by those people”. The Glenrock Town Council is working with their attorney in considering the company’s proposal and a decision is anticipated within the next two weeks. As of February 2012, Mr. Tierney and Mr. Martin have formed Sharps Capital Group, LP. a Wyoming limited partnership, the general partner of which is TM Advisors, LLC , a Wyoming limited liability company. Sharps Capital Group, LP has retained Michael Blank, the former CEO of Sharps Rifle Company, LLC, through the new Sharps Rifle Company, Inc. to serve as its Chief Armorer and Director of Strategic Development upon the successful completion of the Phase I funding. Sharps Capital Group, LP is launching a highly innovative sector-focused private equity initiative in three PHASES that will leverage a special growth opportunity in the firearms industry. PHASE I PHASE II PHASE III $1,300,000 Mezzanine convertible debt (12 months) $5,000,000 Equity $20,000,000 Equity

By combining a number of ‘small cap’ companies into a single portfolio under an iconic brand, Sharps Rifle Company, Inc. the Sharps Capital Group LP will create a unique blend of traditional and modern brands and products to garner above market returns in the international firearms industry. With an aggressive philosophy for quality, integrity and sustainability, Sharps Capital initiative endeavors to make a responsible impact by bridging old economy craftsmanship and new economy market practices. Sharps Capital integrates its core expertise for disciplined long term capital appreciation backstopped by a clear strategic vision to build durable value for its partners. The Sharps name is among the most powerful brands in the U.S. firearms market. Mr. Tierney and Mr. Martin have completed the necessary documentation in order to raise the $1,300,000 in investment in Sharps Rifle Company, Inc. and have begun making presentations to potential investors. Once the necessary capital has been secured by the new Sharps Rifle Company, Inc., Mr. Tierney and Mr. Martin will immediately implement Phase I of the business plan and begin the production, sale and shipment of the Merwin Hulbert revolvers and the Sharps Relia-Bolt from its facility in Glenrock, WY. .

A-Square defaults on lease–CEO closes doors, proposes new business

Kevin Tierney
Sharps Rifle Company, Inc. CEO Kevin Tierney presents his business proposal to the Town Council Feb. 27.

Posted: Thursday, March 1, 2012 10:44 am | Updated: 11:27 am, Thu Mar 15, 2012.

Jesse Bishop Despite hopes that Sharps Rifle Company, LLC, and A-Square of Wyoming would be able to find investors to restart Glenrock operations this year, A-Square of Wyoming is no more. During its regular meeting Feb. 27, the Glenrock Town Council authorized the town attorney to take any legal procedures necessary to terminate the lease agreement with A-Square after accepting their default. After events surrounding A-Square’s former owner and founder Art Alphin led Sharps CEO Michael Blank to shut down both A-Square of South Dakota and Sharps’ main operations in St. Louis, Blank conveyed ownership of all contents in the Glenrock operation to the new CEO Kevin Tierney, and his partner William Martin. After the deal was struck, it was determined that the company as a whole was not fit to even exist. “There is financial tragedy across the board,” Tierney said. “The State of South Dakota has lost a lot of money, the major financial institution in South Dakota has lost an awful lot of money. The State of Wyoming and the Town of Glenrock believed in a lot of people and invested a lot of money to build this facility. There have been numerous consumers who invested money for guns which were not delivered.” Tierney asked Town Council for understanding, explaining his decision to completely shut down the company due to the fact that its financial condition was “toxic, if not radioactive.” He proposed a break on lease payments for a replacement company called Sharps Rifle Company, Inc., which he created using the equipment and intellectual property he acquired from Blank. “If you allow me to work with you with this new company that I intend to form, I’m going to make right by those people and they’re not going to lose a dime,” he said. Tierney announced his plan to raise $1 million from investors over the next six months in order to begin production in Glenrock of a new product that he proposed will be a “positive game changer in the industry.” With his business plan, he anticipates being able to keep a very viable business in Glenrock in the building that formerly housed A-Square. His plan doesn’t end there, however. “After we raise our million dollars, we’re going to try to strike gold and go for $5 million of equity,” Tierney said. “With the $5 million of equity, we’re going to try to acquire two, possibly three companies in the firearms industry. We currently have six companies in America that have expressed interest to be acquired by us once we raise the capital.” Tierney’s proposal to the town was less than sugarcoated, however. He admitted that his company does not have the funds to pay rent on the lease agreement for the building. He proposed that the town give his new company the same lease agreement A-Square had, but defer rent for six months while he raises the needed equity. “I need six months to try to raise $1 million,” he said. “I can’t pay the rent for six months-March, April, May, June, July and August. I’m requesting that the Town of Glenrock will allow me to consolidate the next six months of rent plus all the back taxes, and the next six months of rent and taxes going forward. I’m proposing to pledge as collateral all of the equipment that’s in that building to the Town of Glenrock. Upon me raising the $1 million, I will immediately repay the note and obligation, and I commit to prepay six months more of rent and taxes so that we can be good corporate citizens in this community going forward.”Tierney estimated the rent and taxes to be owed to the Town at around $30,000, but said he believes the equipment offered as collateral is worth $100,000. After going into executive session to discuss Tierney’s proposal, Council referred the matter to legal counsel for due diligence and to draft a possible agreement with Sharps Rifle Company, Inc. Council will consider the matter at its next meeting March 12. The town’s major concern is the involvement of the Wyoming Business Council, which approved a $1.5 million economic development grant to bring a gun manufacturing company to Glenrock, and to build the 8,500-sq.-ft. facility. “We got an economic development grant for that building,” Community Development Director Kathy Patceg said. “It was to supply a new business and jobs for our community, so hopefully this can be used for that. The Business Council really went out on a limb to build such a specific building, so we want to try to keep it in the shooting and sports business.”