Okay, not sure if I missed this previously but this is the real...

Okay, not sure if I missed this previously but this is the real kick in the guts for shareholders:

"In addition to the proposed extension to the maturity date of these convertible notes, Metal Storm also
proposes to seek approval from noteholders and shareholders to amend the conversion price of the
convertible notes so that the convertible notes will convert on a market-based formula without a minimum
conversion price (which is significantly above the current share price)."

So lets get this right. These guys buy the notes at a fraction of face value (assumption) and agree to extend their maturity date. They get a $250k fee for doing this and very favourable terms for converting their fee into equity. Shareholders are expected to stump up $6m just to keep this thing afloat thus protecting and improving the value of the notes these guys just purchased for a song, meanwhile the shareholders are being asked to sign off on a change to the conversion price which improves the conversion rate for these guys by about 500% or more.

So these notes converted at 1c under the existing terms would be worth a maximum of 1.3b shares. If this ammendment is approved this suddenly changes their equity converion to 4.3b shares based on todays share price.

If they sell just a few dollars worth of shares to drop the VWAP for a couple of days to 0.002 then they get 6.5 billion shares. If they try a bit harder and get it to 0.001 (which would take that much eoffrt if you really wanted to) they get 13b shares.

All of the above assumes that the "market based formula" doesn't contain any favourable discounts like all the other formulas detailed in their favour recently.

So I ask you, if we all stump up money just to keep the lights on while we wait for the wheels of govt and related departments to slowly turn, who will own our company if shareholders agree to this change in the conversion rate ?

Am I reading this wrong ? Why would shareholders agree to such a thing ? They purchased their notes privately. They agreed to provide a tiny amount of cash and got a 25% fee. Anybody offering a 25% fee to shareholders for providing the bulk of the funding ? This doesn't smell right.