Yesterday, the management of AGR Tools, Inc. provided a clarification of their operations in response to many recent inquiries from shareholders and potential investors. They are as follows:

AGR Tools, Inc., via the Company’s wholly owned subsidiary AGR Stone & Tools USA, Inc., contract manufactures and distributes tooling and tooling-related products. These are for the professional construction and demolition industries through their stocking dealer network and through their website. The Company garners revenue from the spread between the manufacturing cost of each product they sell and the wholesale price their distributors or customers pay for the same product. Their main assets are their relationships with contract manufacturers, their Matrix Maxx technology, their brand name, as well as their stocking dealer network.

Concerning market niche, AGR manufactures and distributes tooling, as opposed to tools. Tooling is the consumable disposal portion of a tool that makes the tool work. It wears out as the tool is operated. Tooling includes items such as saw blades for saws, drill bits for drills and pads for polishers. Therefore, demand for the Company’s products is driven by the need for original and replacement tool parts.

For tooling products, AGR Tools, Inc.’s product line consists of more than 700 different tooling and tooling-related products. Categories include diamond blades, drill bits, grinding wheels and stones, polishing pads, milling wheels and router bits, and CNC tooling. The design and manufacture of all of the Company’s products are for use by professionals in the construction and demolition industries.

Rock Rutherford, the President and CEO of both AGR and AGR USA, stated, “What differentiates AGR’s products from other products on the market are their superior quality, cost effectiveness and long life. We design and contract manufacture our products with the professional in mind. A professional doesn’t want to spend his day changing saw blades or drill bits, so the longer the life of the tooling, the more efficient he can be. Our goal is simple: to offer better quality tooling at a lower price than our competitors.”

Concerning their Stocking Dealer Network, the Company distributes their products through their stocking dealers and their website. They currently have contracts with 31 stocking dealers covering 48 market territories in the United States and Canada. They plan to increase the number of dealers to 63 covering 121 market territories by the end of the 2012 calendar year. The Company’s stocking dealers purchase their tooling products directly from AGR and then deliver them to their customers.

For revenue growth, AGR Tools, Inc. expects that each of their dealers will generate a minimum of $150,000 in gross revenue per year. As a result, as AGR’s dealership network grows, so will their revenues.

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