KRISS Arms Group Announces the Acquisition of Sphinx, a World Leader in Premier-Quality Pistols, With the Objective of Consolidating and International Promotion of the Swiss Small Arms Industry

NYON and MATTEN, Switzerland, November 9, 2010 - KRISS Arms, the Swiss global leader in firearms innovation,
announces the acquisition of Sphinx Systems Ltd, world leader in high-quality
pistol production.

Founded in 1876, Sphinx has a world-wide reputation as the
benchmark for precision pistols. Manufactured and assembled in
Matten/Interlaken, Switzerland, Sphinx products are used by military and law
enforcement units in Switzerland and abroad. In the commercial market, Sphinx
pistols are valued by competitive shooters.

As noted by the international trade press and media, the
patented KRISS systems have revolutionized traditional firearms engineering.
By eliminating almost all felt recoil and muzzle climb, the Kriss system
ensures a greater degree of control by the shooter. Kriss's patented
technology makes it possible to build significantly lighter, more powerful
and more accurate weapons in both pistol and rifle calibers.

Joint development and production will enable the two entities
to introduce innovative products in the small arms field and position
themselves in both local and international government tenders. "We are very
excited to become part of the KRISS Arms Group and to rely on a strong
partner, marrying the best of traditional firearms manufacturing with the
innovation, as symbolized by the revolutionary patented KRISS Recoil
Mitigation Systems," said Armin Landolt, CEO of Sphinx Systems Ltd.

The acquisition of Sphinx is part of Kriss Arms's strategy to
safeguard Switzerland's respected tradition of technology and know-how in the
small arms field. "We are pleased to be the initiators of the consolidation
of the Swiss small arms industry through the prestigious Sphinx brand.
Preserving the Swiss know-how, and state-of-the art technology are crucial
aspects to position us as leading players on the international small arms
market," said Christophe Guignard, Director of Marketing of KRISS Arms.

The first products from this consolidation will be showcased
early 2011, including models and accessories specifically built for military
and law enforcement and new commercial lines for the U.S. market.

The expansion of production and sales components will result
in expanded employment positions in Switzerland.

For further information:

Sphinx Systems AG : www.sphinxarms.com

KRISS Systems SA : www.kriss-arms.com

    Contact:

    Christophe Guignard
    KRISS Systems SA
    Tel.: +41-22-363-78-20
    E-mail: chg@gammart.com

Contact: Christophe Guignard, KRISS Systems SA, Tel.: +41-22-363-78-20, E-mail: chg at gammart.com