May 31, 2012 Dear Shareholders,

May 31, 2012



Dear Shareholders,

You have probably seen our Kingchipper KC 125 in action on the videos page of our consumer website: http://www.tytantractor.com/. It is truly the best chipper in its price range. In fact, I would put it up against chippers costing twice as much and I believe I would win that bet.



In 1992, I was the first American to go to China and have a chipper made. I brought a sample and some ideas to the Jinma Tractor factory, for which Rhino was the exclusive agent at that time. Jinma did a great job of producing it. After I had sold the Rhino Company, Jinma continued with the sales efforts on the chipper I had created. It had been a huge seller over the last seventeen years, until Tytan came out with the Kingchipper. Prior to the start of the economic slowdown three years ago, Tytan had sold a lot of chippers and was gaining momentum fast.



More recently, I have noticed many more statewide restrictions on burning brush and debris, and encouraging chipping as a better solution. After many years of heavy use and much research, I have made a list of improvements to the design and function of the machine. Some are very valuable features that do not show on the surface but make a huge difference in the function of the chipper.



The original KC 125 has now been replaced with the red model above. Additionally, we now have a KC 150 and KC 200. These are in stock. These all three have much superior manufacturing quality to what we had in the previous KC 125. Here are a few points :

1. All the bolts and hardware etc are a much higher quality, the chipper main frames are close to 1/3" thick steel and that is much thicker then our previous KC 125 and others on the market

2. The metal is bead blasted in preparation for a quality under coating and final painting.

3. We will have a Parts book that will be nicer then any others in the Industry.



I should add also that the coming shipments of our new chippers have even more new features and improvements. At Tytan, we are preparing color brochures and will be taking our sales effort everywhere. That means we will seek retail sales directly and if we run across dealers who meet our standards, they can easily step in and take full advantage of what we have started in their area.



Additionally, we now have a new log splitter that will be available in either 32 Ton ( #LS3213 ) or 40 Ton ( LS4013 ) pressing power. These log splitters are self contained, with an engine and trailer. They operate in horizontal or vertical positions. Tytan's is a bit different than the one pictured, since Tytan's has a much longer tongue, wider wheel base, larger tires and the purchaser has the choice of either a gas or diesel engine.



I have commented before about having our "ducks in a row". We will have a very attractive selection of chippers, splitters and other complementing products for the Consumer & Dealers to select from. We are entering a period with the economy starting to show some improvements and these pictured items have no barriers. They can be sold to any tractor dealership and will open doors for our other products. We do have a lot of things we are working on and this is all part of having a complete deck of cards when we start adding dealers to our team.



We are working hard now to get dealers started on a seeding program. I look to see results from these efforts, mostly in the 3rd and 4th quarter, just from the turnaround stand point. Please understand that many orders will require assembly such as putting on front loaders etc. Some dealerships will receive direct shipments from the factory. We also have an extensive inventory of implements.



We will see growth coming from dealer orders that can be very substantial or in our new internet sales ability that will be completed shortly. You can see a few of the presentations that are up and running on our consumer homepage by clicking on the 334 Tractor , 406 Crawler or Implements buttons about 2/3 the way down the page. Of course, we have lots of house cleaning still to make everything perfect. Additionally, as far as this Mailbag section goes, most of the work is done late at night or early am. My priority is to get you information asap. For that reason we will always publish these news letters after the work is completed. We also risk losing the work, if we wait till morning to publish. Prior to 10am the next morning PST, we will have any needed corrections made. That is how this page will be handled.



Thanks and have a great week!



Mark