(Reuters) - An armed man was shot to death during a hostage situation at a motorcycle shop in Neenah, Wisconsin, on Saturday, in a standoff with police that ended when another gunman surrendered, authorities said.

Police responded to a report of a disturbance at Eagle Nation Cycles, where a man had fired at least one shot and taken several hostages, city Police Chief Kevin Wilkinson told a news conference. Neenah is a city of about 25,000 people some 100 miles (160 km) north of Milwaukee.

When it appeared the hostages were in danger of being killed, police tried to storm the shop and were met with gunfire, with a bullet striking the helmet of one officer, Wilkinson said.

An armed man, who was not the person who caused the initial disturbance, came out of the shop but did not comply with orders to drop the weapon, and officers opened fire, Wilkinson said.

The man was fatally shot, but Wilkinson said it was possible he may have been struck by a bullet fired by the other armed man inside.

The man who caused the initial disturbance later allowed the hostages to escape and surrendered.

The officer who was struck in the helmet was taken to a hospital and released.

Police did not immediately identify the two men.

The incident forced the evacuation of nearby homes and businesses. An investigation is under way.