ARLINGTON, Va., Sept. 23 /PRNewswire-FirstCall/ -- Defense technology company Metal Storm Limited today announced that it's US subsidiary, Metal Storm, Inc has signed an agreement with the US Army to develop and adapt munitions for use with Metal Storm 40mm weapons systems. David Smith, Metal Storm's CEO, said the Cooperative Research and Development Agreement (CRADA) is significant because it formalizes the company's partnership with a key defense industry research organization. "The CRADA will allow us to take existing certified munitions from the US Army inventory and convert them to Metal Storm configuration," he said. "Our agreement with the US Army Research Development and Engineering Center (ARDEC) provides us with the opportunity to establish a successful business development partnership with one of the defense industry's most influential research organizations," he said. "It also supports Metal Storm's clearly stated strategy of focusing on its core 40mm technology, getting it to market in the shortest time possible and transforming itself into a systems integrator." Mr. Smith said the agreement would provide the framework for the rapid development testing and eventual certification of a range of 40mm munitions for use with Metal Storm's weapon systems. Under the agreement, which has a life of up to 5 years, Metal Storm will work closely with US Army engineers and will have access to specialized equipment, laboratories, and armaments facilities on a fee for service basis. The estimated cost to Metal Storm of the scope of works under this agreement is up to US$549,000 (approximately AU$730,000) which the Company expects to be completed within the next 12 to 18 months. Notes: Metal Storm's Australian Stock Exchange trading code: MST Metal Storm's NASDAQ Small Cap ticker symbol: MTSX http://www.metalstorm.com/ About ARDEC Headquartered at Picatinny, New Jersey, ARDEC is the US Army's principal researcher, developer and sustainer of current and future armament and munitions systems. ARDEC's overall mission is to improve already fielded items, develop new ones, maintain a strong armament technology base in government, industry and academia and provide technical support to the soldier in the field. It plays a key part in Army Transformation with its involvement in the development of the Soldier and Future Combat Systems (FCS) and continued efforts in the development of advanced weapons that exploit new technologies. ARDEC has over 2,500 highly skilled scientists, engineers and other technical specialists situated at five different locations throughout the US. They are responsible for several hundred programs and have expertise, technology and unique laboratory and facility capabilities in weapon and ammunition systems, propellants, aerodynamic stabilization, modeling and simulation, fire control, logistics integration of armaments systems and related safety systems and protocols. ARDEC has a long history of partnering with industry in the research, development, production and fielding of advanced armaments for the soldier. Although ARDEC's principal mission is to mature technologies for armaments applications, ARDEC also looks for ways to transfer beneficial technologies to public use. ARDEC has recently transferred technologies to the law enforcement community such as non-lethal, aversive technologies for crowd control. ARDEC has over 80 active Cooperative Research and Development Agreements (CRADAs). About Metal Storm Metal Storm Limited is a defense technology company engaged in the development of electronically initiated ballistics systems using its unique "stacked round" technology. The company is headquartered in Brisbane, Australia and incorporated in the US, with an office in Washington DC. The company has invented a ballistics technology that has no known conventional equivalent. Metal Storm is working with government agencies and departments, as well as industry, to develop a variety of systems utilizing the Metal Storm non-mechanical, electronically fired stacked ammunition system. Safe Harbor Certain statements made herein that use the words "estimate," "project," "intend," "expect," "believe" and similar expressions are intended to identify forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks and uncertainties which could cause the actual results, performance or achievements of the company to be materially different from those which may be expressed or implied by such statements, including, among others, risks or uncertainties associated with the development of the company's technology, the ability of the company to meet its financial requirements, the ability of the company to protect its proprietary technology, potential limitations on the company's technology, the market for the company's products, government regulation in Australia and the US, changes in tax and other laws, changes in competition and the loss of key personnel. For additional information regarding these and other risks and uncertainties associated with the company's business, reference is made to the company's reports filed from time to time with the Securities and Exchange Commission, including the company's Form 20-F. DATASOURCE: Metal Storm Limited CONTACT: Investor: Gregory Pettit, +1-212-885-0301, , or Media: Stefan Anikewich, +1-212-885-0505, , both of Hill & Knowlton for Metal Storm Web site: http://www.metalstorm.com/

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