Industry News RECOIL Exclusive: Hudson Responds To SHOT No Show Patrick Roberts January 24, 2019 While new product introductions might have caught us off-guard, Hudson's absence from both Media Day at the Range and on the floor of SHOT Show wasn't something that we saw coming. What does this mean for Hudson? We reached out to Hudson seeking comment and received the response below: To our customers and friends, sorry we couldn’t be there, but even in our absence, apparently we are still a highlight of SHOT’19. We can’t think of any other reason we would be reached out to for comment on our empty booth space. *If you don’t have money to ship people’s warranty guns home, then you shouldn’t spend money to go to a show. Hudson Mfg is currently working to raise capital and resolve a matter with a critical single-source supplier that has affected many of our warranty customers and our relationships within the industry. We attempted to resolve the issue professionally and notified said supplier of their impact to Hudson both financially and reputationally; they decided to sue us instead of work to resolve the issue. We will not disclose further information at this time due to non-disclosure agreements in place. We regret the delay this has caused for our current customers experiencing warranty issues; our future customers whose perception of the company has been tainted; our other outstanding suppliers and partners who’ve stood by patiently waiting for us to right the ship; and very importantly, for the Hudson Team who pulled out every stop internally to make a difference. This is not an easy pivot. The challenges of raising capital as a firearms startup with significant harm to its cash flow are many. Those challenges have been compounded by the state of the industry over the past year and a half. Many equity buyers look for companies selling cheaply made products at four to five times their cost; Hudson’s strategy included heavy upfront investment to build value in the company, a Brand, and a differentiated product family before expecting to see significant equity returns ten years after the formation of the company – a tough sell for owners whose focus is not a quality product for the consumer. Our primary funding option that was scheduled to close in 4th QTR 2018 did not occur. We continue to speak with capital groups and interested equity parties. This is the information we can give at this time. If you know an interested party who truly believes in quality American manufacturing (not manufacturing overseas and stamping “Made in USA” on it) or would like to help realize what is in store for the platform: please have them e-mail [email protected] with thoughts on an offer or a request for an NDA. We have considered crowdfunding the effort, but there are very few online crowdfunding platforms available that allow for firearms. V/r, Cy & Lauren Hudson While waiting on Hudson to release a statement explaining their absence we were made aware of a lawsuit filed in New York by Cambridge Valley Machining. The lawsuit (found here) alleges that Hudson contracted Cambridge Valley Machining to produce parts for the H9 pistol back in 2016. Cambridge Valley says that they entered an agreement and began producing the first 2,500 parts, completed them, and shipped them to Hudson. You can read what Cambridge Valley said in the lawsuit below. Hudson accepted and retained these parts without objection, but failed to pay for parts worth a total of at least $384,730.99. Hudson continues to refuse to pay for such parts. We also spoke with several industry sources telling us that most of the workforce, if not all of it, has been laid off quietly. Interestingly, Hudson was no longer listed as an exhibitor on the Industry Day website even though they were prominently marked on the range maps and had signs on some tents. Pulling up an archived copy of the same page from October 19th, they were clearly listed as an exhibitor and were slated to be in lane SR-4, presumably so that media and buyers could shoot the H9 and H9A pistols. The company Facebook page is filled with angry customers who have guns in need of repair, some have even sent their guns in for service and now are receiving no response from the customer service team. Unfortunately, Cy and Lauren didn't indicate when those customer guns and warranty issues would be addressed. We will update with more as we learn new information. 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