Product Strategy to Capitalise on New FundingBrisbane, Australia...

Product Strategy to Capitalise on New Funding

Brisbane, Australia – April 24, 2012: Metal Storm Limited.

Defence technology specialist Metal Storm Limited today outlined the three major steps to be
completed by the Company in order to reach a positive cash flow and deliver growth in shareholder
value through product sales.
Last week, the Company announced a deal to acquire $5M in cash, plus an agreement to eliminate
$11.9M – over 80% - of its secured convertible note debt.
Metal Storm CEO, Dr Lee Finniear, said while the GFC and other capital constraints had held the
Company back, the latest debt restructure and capital injection will drive Metal Storm forward on its
strategic course.
“Our strategy and planning is solid, demand for our non-lethal weapons is high, and we are
collaborating with excellent, well-respected industry players including Colt, BAE and TASER
International,” he said.
“Now that a major piece of the capital restructuring is in train, the Company can also focus on getting
its non-lethal weapon and ammunition systems into user trials.”
“Plus, with the secured debt mostly eliminated, shareholder value should grow more rapidly and with
fewer obstacles as we move ahead.
The three major steps to be completed by Metal Storm include:
• Restructure its capital base and acquire funds for product commercialisation
• Undertake initial production for user field trials and product compliance evaluation
• Enter full production and sell internationally in volume
The first product the Company is bringing to market is its MAUL™ ultra-light 12 gauge accessory
launcher, together with non-lethal, TASER® and door breaching ammunition. MAUL™ is the ultimate
accessory weapon to provide officers with a choice of non-lethal responses instead of using lethal
force.
“The product is well advanced, and initial demonstration units have been built,” Dr Finniear said.
“Demonstration firings have attracted audiences across the USA. Over 60 agencies in the USA and
Australia have requested user trials or further demonstrations. Our challenge has been to find funding
to build additional enhanced trial weapons and ammunition to support this demand.
“Once the funds from the transaction arrive in July, we will complete integration and commence
building up to 50 MAUL™ weapons plus ammunition in a low rate initial production run (LRIP). These
weapons will be allocated to three important groups: selected trial users, international distributors for
business development, and to our compliance testing team for product compliance evaluation.
“The Company intends to ramp up to full production as key sales opportunities progress and when
volume orders are received. For the final production models, the Company will take into account
relevant feedback from the field trials, plus any specific enhancements requested by international
distributors that would materially contribute to volume sales.
Metal Storm Limited
ACN 064 270 006
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In addition to MAUL™ production, the Company remains engaged on a number of strategic customer
funded projects and potentially funded opportunities, specifically:
• The US Marines MPM Engineering & Manufacturing Development (EMD) Phase
• The Defence Canada Small Arms Replacement Program
• The $1B US DoD Force Protection Program
• The Managed Lethality Grenade Launcher System
“The recently announced equity raise and debt reduction is a massive step toward satisfying the
Company’s capital restructuring needs. Our focus on delivering product to market can now progress
without such a large and looming debt horizon depressing shareholder value at a time when the
Company believes it should be appreciating,” Dr Finniear said.